PSA Peugeot Citroen needs to get back into profit. Their sales have been declining for some six years and now they have reached a 20 year low. So they have come up with a strategy.
Peugeot will be flying the flag for their company's more prestigious models and this would - one would think - mean that Citroen will become their budget brand. This is something, I have to say, that Departing Chief Executive Officer Philippe Varin has denied.
Personally, I don't quite see how Citroen can avoid becoming their budget brand. After all, PSA Peugeot Citroen have introduced the Cactus to meet the demands of people who are looking for a car that is cheaper than those already in their current model range.
Being as Citroen don't already pedal the most expensive cars in the marketplace as it stands today, I am wondering how they will position the Cactus. If it is, indeed, priced more cheaply than their more conventional cars, it will be one hell of a bargain.
This is a car that boasts some excellent technology and it has some really innovative funding packages behind it to aid affordability. It is super-economical to run (boasting 86g/km CO2 emissions and 91.1mpg combined) and to top it off, it just doesn't look like a budget vehicle.
Personally, I can't wait to see what the pricing announcement will bring. If they do price the C4 Cactus beneath their entry level models than Citroen inevitably run the risk of being repositioned as a "budget brand" - whether they like it, or not.
You have to remember that it hasn't done Dacia any disfavours for Renault - perhaps this strategy could be just the ticket to start the ball rolling when it comes to getting PSA Peugeot Citroen back into the black.
It could always do the opposite, of course, depending on how PSA Peugeot Citroen decide to play it.
Written by @MotorMistress
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