Ahmedabad, 27 April 2012

Senior executives of French car maker PSA Peugeot Citroen will meet Gujarat government officials on May 2 to discuss the future of Rs 4000-crore Sanand project.

Last year Peugeot announced an investment of Rs 4,000 crore in Gujarat by setting up an integrated manufacturing unit, engine and gearbox plant to manufacture cars in Sanand near Ahmedabad. The state had signed a state support agreement(SSA) and allotted 600 acres of land for first phase of the project. In November last year the company laid foundation stone of the plant but could not pay the state govt the first installment of Rs 25 crore.

Early this week Peugeot’s Asia head Gregoire Olivier said in Beijing that the company may not go ahead with its Sanand project and would look at its global partner General Motors for launching cars in India. “There are a lot of other ways to enter India now that they don’t require us to put euro 600 million on the table,” he said.

In February this year, General Motors and PSA Peugeot announced a global alliance in which GM bought a 7% stake in Peugeot. GM India has car manufacturing plant at Halol in central Gujarat.