Naza Corporation Holdings and Groupe PSA, the manufacturer of Peugeot and Citroen vehicles, have signed a share sale agreement and a joint-venture agreement which marks a new phase for Naza, which took on the Peugeot franchise in 2008 (via its subsidiary Nasim). The shared operation of the Naza Automotive Manufacturing (NAM) plant in Gurun, Kedah, will be the first manufacturing hub in ASEAN for Groupe PSA. The French carmaker now has majority stake in the business operations of NAM and the Naza Group will focus on distribution of Peugeot, Citroen and DS Automobiles in the domestic market.

With this agreement, Groupe PSA and Naza will jointly produce Groupe PSA branded cars for Malaysia and other ASEAN markets which have a potential customer base of 680 million. Further opportunities will also be explored beyond ASEAN, with a potential to contribute significantly to Malaysia’s economy.

“We are grateful for Groupe PSA’s support and confidence in Naza Corporation Holdings as we take our longstanding partnership to greater heights. With this collaboration, there is enormous potential for Kedah to be the leading automotive manufacturing hub in Malaysia,” said SM Nasarudin SM Nasimuddin, Group Executive Chairman/CEO, Naza Corporation Holdings.

This development comes 8 years after the French carmaker picked Malaysia as its regional hub from which it will spearhead its expansion in the ASEAN region. At that time, Groupe PSA’s decision was based on Naza’s excellent performance in boosting sales in Malaysia, making it the biggest regional market for Peugeot, accounting for 86% of its sales in 2010.

As part of Peugeot’s plans to expand its presence in the region and the importance of Malaysia to the French carmaker, the company also expand its ASEAN Regional Office in Selangor to coordinate operations for the entire Asia-Pacific region (excluding China). Peugeot’s ASEAN Regional Office in Malaysia also runs an ASEAN training centre and technical help desk for after-sales technicians in the Asia-Pacific region and the Middle East.

File picture of a Peugeot sedan being assembled at NAM.

Since taking on the Peugeot franchise 10 years ago, NAM has been assembling many different models for the Malaysian market as well as exporting the 207 assembled at NAM to neighbouring countries. Prior to NAM assembling Peugeot models, the French cars were assembled at Asia Automobile Industries in Selangor in the 1970s and then at Oriental Assemblers in Johor in the 1990s. Citroen models like the BX, ZX and Xantia were also assembled at the HICOM Automotive Manufacturers (Malaysia) complex (then known as AMM) in Pahang during the 1990s.

The last Citroen Xantia assembled in Malaysia getting QC checks at the AMM plant in Pahang in 2000.

This strategic partnership will benefit from the strong and qualitative supplier network implemented in the region. NAM, which has been operating since 2004, has a workforce of close to 450 people and can produce up to 50,000 vehicles annually. Groupe PSA’s investment in NAM will see the implementation of its EMP2 modular platform dedicated to C and D segments – taking the partnership and Naza’s commitment to another level.

“The creation of the ASEAN hub in Gurun, Kedah is a significant leap forward for Groupe PSA which will lead to the development of a profitable business in the region as part of our Push to Pass strategic plan. We are pleased to partner with Naza Corporation Holdings and continue leveraging our historical relationship,” said Carlos Tavares, Chairman of the Managing Board of Groupe PSA.

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