New Delhi: Stellantis, which operates through Jeep and Citroen brands in the country, is profitable as a Group. However not both the brands have reached the profitability mark in the country yet, according to a senior company official.
“Both Jeep and Stellantis have been profitable in India and we will be profitable this year too. Not so many OEMs operating in the country can say that,” Roland Bouchara, CEO & MD of Stellantis in India, told ETAuto.
He confirmed that the Jeep brand was profitable in 2021, and added, “To be able to invest in new technologies, profitability is important for the business.”
The parent entity which is also the world’s fifth largest automaker stated that while Citroen is not independently profitable, it expects the brand to join the league soon.
“We can be satisfied with where we are but we want to do better. The Indian market has the potential, and we should be able to increase the sales in the region,” Bouchara said.
However, the European carmaker has been betting big on its C-Cube platform which was developed in India, by the Indians. It is also being deployed for the Latin American markets.
Earlier, Carlos Tavares, global CEO, Stellantis credited the company’s profits in India to its frugal investment approach. “Our breakeven point is 40% of net revenue,” he said.
In January 2021, Stellantis was formed with the merger of FCA (Fiat Chrysler Automobiles) and France’s PSA Group. Jeep took over from the Fiat brand in India and Citroen from Peugeot.
The company now operates from 3 manufacturing plants- Ranjangaon near Pune, Hosur in Tamil Nadu and Thiruvallur on the outskirts of Chennai. It also has an ICT Hub in Hyderabad, a software centre in Bengaluru and two R&D centres in Pune and Chennai. About 3000 people have been employed in the country.
Unlike other foreign automakers in India, Stellantis’ business model is joint venture (JV) based. It gets an advantage of manufacturing Jeep vehicles in the Fiat, Tata Motors JV plant in Ranjangaon.
PSA Group, the French automobile major which makes Peugeot and Citroen cars, re-entered India by signing an agreement with the CK Birla Group. The erstwhile CK Birla car plant for assembling Mitsubishi models is used for Citroen.
Stellantis’ transmission JV plant in Hosur saw the installation of some refurbished machinery shifted from outside India. Moreover, the company has also begun exports of its powertrain which is contributing to profits in India.
The automaker’s Citroen brand forayed into the domestic market with its C5 Aircross SUV in April 2021. The C3 compact car was introduced in the petrol version in July this year and it is now set to enter into the EV space with the electric version in January 2023.
In FY22, the company sold 775 units of the C5 Aircross in the country. The brand currently has a market share of less than 1% in the Indian passenger vehicle market. By the end of calendar year 2022, its target is to sell about 6000 units of the C3 and 500 units of C5 Aircross in India.
On the other hand, Jeep started with its Compass model in India, which was launched in August 2017. The company now offers 4 products in its portfolio, Compass, Wrangler, Meridian, and the recently-launched Grand Cherokee.
“We have a long commitment in India. We should be one of the major key players in the (SUV) segment which is expected to grow in the upcoming years,” Tavares said.
The Amsterdam-based auto major has a portfolio of 14 automotive brands globally, including Jeep, Peugeot, Opel and Maserati.
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The world’s fourth largest automotive Group thinks garnering a higher share in the nascent EV market, than in the ICE vehicle space, to be gainful in the long term as the passenger vehicle market goes fully electric. The Citroen C3 EV, scheduled for launch in early 2023, will drive that strategy in India mainly targeting its aspirational middle class.
