PSA Peugeot Citroën Investing €557 Million In New Morocco Plant

PSA Peugeot Citroën has officially announced it will build a new assembly plant in Morocco to build cars and engines for markets in Africa and the Middle East.

The French automaker will invest €557 million ($632 million) to build the new facility, which will begin production in 2019.

In the presence of His Majesty King Mohammed VI, PSA Peugeot Citroën CEO Carlos Tavares and government officials from Morocco signed an agreement for a new plant that will be located in Ameur Seflia, in the Kenitra region of Morocco.

PSA Peugeot Citroën will build B- and C-segment vehicles, as well as engines for the local market and other countries in the region. The facility will have an initial production capacity of 90,000 vehicles and engines, but will be able to build 200,000 vehicles and engines when it reaches full capacity. No details were offered about the models and engines which will be built in Morocco.

The automaker estimates it will localize 60 percent of components at the beginning of production, with the rate expected to reach 80 percent later on. The new plant in Morocco is part of PSA’s plans to sell 1 million vehicles in Africa and the Middle East by 2025, out of an estimated 8 million overall sales in these regions.

Africa and the Middle East are historic markets for PSA, especially for the Peugeot brand, which is the No. 2 brand in Algeria. The group is No. 1 in Tunisia and No. 2 in Morocco.

Note: Peugeot 301 pictured