PSA GROUP TO BASE SUPPLIERS IN INDIA

The French carmaker is targeting two percent of the Indian passenger vehicle market by 2024. Last week, there was an India Suppliers Summit held, which drew over 500 automotive component vendors and both Tier I and Tier II suppliers.  The PSA group is implementing its ‘Push to Pass’ strategy to increase its sales outside Europe by 50 percentThe PSA Group’s localisation goals. When asked if five years is a realistic timeline for the sourcing figure to touch a billion euros (Rs 7,644 crore), Michelle Wen, executive vice-president, Global Purchasing and Supplier Quality, Groupe PSA, said that she would like it to happen much earlier. Export of made-in-India Citroëns will play a big role for the PSA Group to achieve economies of scale to justify localisation of over 90 percent from the start of production.




This will involve a very high 98 percent localisation for the vehicle and 90 percent for the C5 Aircross engine. Groupe PSA has two joint ventures in Tamil Nadu with the CK Birla Group for vehicle assembly at Thiruvallur, and a powertrain plant with AVTEC, which was inaugurated on November 22, 2018. These will help the company achieve this high level of localisation.The second phase of the plan runs from 2019 until 2021, and aims to grow the company’s global presence with entry into several new markets, including India. Expansion of its product range and a focus on electrification and digital technology are some of the manufacturer’s goals in the upcoming phase.

At the Supplier Summit, Michelle Wen – along with Emmanuel Delay, executive VP and Head of India-Pacific, Groupe PSA and Gillies Le Borgne, senior vice-president, Engineering & Quality, Quality, cost and delivery performance, TCO Michelle Wen, executive vice-president, Global Purchasing and Supplier Quality, Groupe PSA, said: “In a context of fierce competition, purchasing has a key role to play in terms of performance for projects and serial life production phases. We are looking for ‘QCD’ (Quality, Cost & Delivery) performance, not only the lowest cost per part, but also TCO (Total Cost of Ownership). The Monosokuri approach, gathering engineering, manufacturing and purchasing will make the difference towards competitors, and our sourcing with Indian suppliers will lead to newer verticals and opportunities to meet customer needs and respond to the technological shift.

 

This summit also focuses on developing and integrating a broad network of Indian suppliers through encouraging collaborative product development, orchestrating and connecting information across the supply chain, and understanding an ecosystem of suppliers and partners within it.’’The ethical, environmental and social criteria are crucial for the selection of a new supplier – criteria regularly assessed by a third party. This assessment covers environment, labour practices, fair business practices, and sustainable procurement and is used for the risk identification as well as for the selection of sites to be audited. Each supplier assessed receives a score card that covers all relevant aspects of the evaluation.

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