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French PSA Group chooses Turkey as pilot country for restructuring

French PSA Group chooses Turkey as pilot country for restructuring

One of the leading car manufacturers, PSA Group, has chosen Turkey as its pilot country for restructuring. The French automaker has recently merged its Peugeot, Citroen, DS and Opel brands under a single roof for the first time in Turkey.

The operation, which started in September 2018, was completed on April 1, 2019, with Opel moving from İzmir to Istanbul, thus incorporating the sales, marketing and after-sales activities of four brands under a single roof in the Istanbul office. The company will put the new organizational structure in practice in Italy and South Africa in September after Turkey.

In the aftermath of its acquisition of Opel from General Motors in a deal valuing the business at $2.3 billion in 2017, the PSA Group was named Europe’s second largest automotive group. Olivier Cornuaille, the head of PSA Group Turkey, said that the company chose Turkey as the leading country due to its significance. Sent to Turkey by PSA Group CEO Carlos Tavares as the sole executive in charge, Cornuaille said that the merger of the Opel, DS and Peugeot brands had been completed, and that he will serve in this position until the appointment of the new Citroen general manager.

Stressing that they will begin to reap the fruits of the new organization from this year, Cornuaille elaborated on the company’s 2019 targets, saying they aimed to achieve a market share of 11.6 percent with an increase of 15 percent and to maintain the third position in the automotive sector.

“Six new models will be available this year,” Cornuaille said. “No other brand can reach this figure. We are planning to increase the number of dealers from 123 to 144. We aim to achieve TL 1 trillion in the after-sales services turnover at the end of the year.”

Cornuaille said that they would bring together the customs-fictive bonded warehouses of the four brands, adding they had Istanbul and Opel’s existing customs area in İzmir in mind in this scope.

In the meantime, PSA Group, which inaugurated its first multi-brand showroom comprising of Peugeot, Citroen, Opel and DS brands in late January in Madrid, announced it will be opening its second dealership with the same concept in Turkey’s central province of Konya. The French manufacturer is projecting to make at least 80 percent of its showrooms in Europe multi-branded by the end of 2021.

Answering questions regarding Citroen’s acquisition of sales and after-sales services from Bayraktar Group, Cornuaille avoided giving any details such as compensation due to a confidentiality agreement.

“For 25 years, they had represented the Citroen brand well in Turkey. However, the relationship was no longer going anywhere. Neither Baylas nor we were pleased with this situation. Neither were the dealers,” Cornuaille continued. “Distribution is not an easy task when the market is shrinking. When the crisis strikes, you have to decide on the future. We sat together. Of course, after 25 years, divorce is not easy for both parties. We then convinced PSA Group CEO Carlos Tavares and got the approval.”

Baylas Otomotiv A.Ş., one of the Bayraktar Group’s companies, had been handling the general distributorship of Citroen in Turkey since 1995.

He stated that they expect the market to be around 520,000 units at the end of the year. “Maybe it could drop, but you should look at the bright side. I am optimistic. The government supports the automotive industry. The excise duty incentive and, finally, the tax base increase in scrap also prove this,” he noted. “PSA Group will fight, no matter what the circumstances. We have to believe the market will be bigger. We were lucky compared to other brands. We are rebuilding.”

From 1998 to 2004, Cornuaille served at Oyak Renault and Renault Mais in Turkey. He then returned to France. Unable to leave Turkey behind, Cornuaille worked as the Renault executive in charge of Turkey. His second term in Turkey began in 2010. He held various positions at Renault Mais and Oyak. In 2014, he became the Turkey general manager of the Nissan Middle East Department. He finalized the transfer of Sumitomo’s shares in Nissan Turkey. Spending the 10th year of his career in Turkey, Cornuaille is also quite fluent in Turkish.