Peugeot Citroen announces China joint venture

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French car maker PSA Peugeot Citroen formally agreed an 8.4-billion-yuan (935-million-euro, 1.2-billion-dollar) joint venture with Chinese group Changan Automobile to increase Peugeot's foothold in the rapidly expanding China market, the companies announced Friday.

The first vehicles are set to roll off the production line in 2012, according to a joint statement.

Based in Shenzhen, in southern Guangdong province, the joint venture will have an initial annual production capacity of 200,000 vehicles.

It will concentrate on launching the Citroen DS3 on the Chinese market, as well as sales of Peugeot and Changan vehicles.

The formal agreement follows the signing of a letter of intent in May.

Auto sales in China hit 9.02 million in the first half of 2010, a year-on-year rise of 48 percent, industry group China Association of Automobile Manufacturers said Friday.

© 2010 AFP

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