Exports of China-made PSA engines surge on strong demand in Europe

WUHAN - Exports of China-made PSA car engines are experiencing a sharp increase driven by robust European demand for the French auto giant's compact models.

PSA Peugeot Citroen, Europe's second-largest auto producer, is expected to order a total of 148,000 1.2-liter turbo-charged gasoline engines produced by its Chinese joint venture with Dongfeng Motor by June 2018, the Wuhan-based automaker said.

Previously, PSA had planned to ship 55,000 engines to its European assembly plants from July 2017 through May 2018, but has reported additional shipments since September due to increased orders. The demand from Europe will reach 30,000 units in the first two months of 2018 alone.

The Dongfeng Peugeot Citroen Automobile Co. Ltd began producing the three-cylinder engine for export in June last year at its plant in the central China city of Xiangyang, roughly 300 kilometers northwest of Wuhan.

Dongfeng produces Citroen and Peugeot cars. In China, the engine is used in small cars such as the Peugeot 2008, 308 and 408, and the Citroen C3-XR and C4L.

Due to stiff competition from German and Japanese brands, PSA sales in China have decreased in the past two years, prompting the French automaker to make better use of its Chinese production capacity for exports.

PSA's joint venture with Dongfeng reported its 2017 sales dropped 37 percent from a year earlier to 378,000 units, compared with its record high of 705,000 units in 2015.