By Gilles Guillaume
PARIS May 22 PSA Peugeot Citroen
plans to build its next C3 compact model in Slovakia instead of
France, sources close to the French carmaker told Reuters on
The move is part of a strategy to switch production of
mass-market small cars away from Western Europe where costs are
considered too high and instead build higher-end models in the
"They're starting technical operations on the new Citroen
model in the coming weeks... it's going to be in eastern Europe,
in Trnava," one source close to the matter told Reuters.
Two other sources close to the car group confirmed that a
decision had been made to produce the future C3 in Slovakia,
where the company already builds the C3 Picasso multi-purpose
vehicle and the Peugeot 208.
A PSA spokesman declined to confirm the production move and
said the carmaker did not unveil such plans in advance. He said
PSA had pledged to preserve its French factories as part of a
labour deal signed last year.
PSA Chief Executive Carlos Tavares and his predecessor
Philippe Varin have repeatedly said it is no longer viable to
produce mass-market small cars in France because tough
competition mean prices on such models are too low to cover the
Tavares is expected to face questions from unions on Friday
during a visit to a factory in Poissy, near Paris, where the C3
is currently produced for the European market along with the
premium DS3 model.
Other car manufacturers are shifting production of smaller
vehicles to low-cost European countries.
GM's Opel Corsa and Volkswagen's Polo are
already built in Spain, and according to press reports, Fiat
plans to produce a new version of its Punto at its
Tychy factory in southern Poland.
In March, Mercedes said it would add additional
shifts to build the CLA A-Class and B-Class vehicles in
Kecskemet, Hungary, although it said this was because its plant
in Rastatt, Germany was already running at full capacity.
(Additional reporting by Ed Taylor; Writing by James Regan and
Andrew Callus; Editing by Leila Abboud and Jane Merriman)