Mahindra planning to buy Peugeot scooter division

French newspaper Le Parisien has reported that Peugeot Citroën Automobile Group (PAS) is planning to sell its scooter division to Indian automotive manufacturer Mahindra & Mahindra. The decision to sell the scooter division has been taken by Peugeot to cut down the financial losses that the organisation has been facing for the past few years. PSA had managed to sell 79,000 units in 2013 which meant it registered an 8.2 per cent growth in sales. But the French manufacturer claims the returns weren’t financially encouraging given the loses it has sustained over the years. 

Peugeot Motorcycles currently employs around 500 people in France apart from the 300 personal who are working in a joint venture production plant in China. PAS was looking at the three-wheeler market to revive sales and had developed the Metropolis to take on the Vespa MP3 but it could never match the target of 7,000 units per year for the three-wheeler. PSA spokesperson Jean-Baptiste hasn’t confirmed or denied the speculation. 

If Mahindra is able to sign the deal the biggest outcome from it will be the modern technological knowhow that PSA posses. Also it will be instrumental in Mahindra spreading its wings in the European market. Given the fact that Mahindra 2wheeler has been focussing on the scooter segment (a 110cc scooter is on the anvil) the deal will bring in lot of positives for it. 

PSA also have an electric scooter division whether the deal will consist of it isn’t clear but given the fact that Mahindra already has the GenZee electric scooter it will be keen on the electric scooter technology of PSA. If the deal is signed, Mahindra will join the ranks of Bajaj Auto (KTM) and Hero MotoCorp (EBR) to hold a stake in an international two-wheeler brand.