PSA to Develop New Vans at French Plant

PSA Peugeot Citroen plans to invest more than €750 million to upgrade its plant in Sevelnord, France, and develop a new light commercial vehicle to be built there.

PSA agreed last month to supply vans for Toyota Motor Corp. to sell under its namesake brand in Europe. Workers at the Sevelnord factory in late July accepted a pay freeze and new work rules to increase the factory's efficiency.

PSA will initially provide Toyota with a midsize delivery van, beginning in the second quarter of next year. The vehicle will be based on the Peugeot Expert and Citroen Jumpy models already made in Sevelnord.

In the longer term, the two companies will collaborate in designing commercial vehicles to be made at the facility in northern France. PSA says Toyota will contribute an unspecified portion of the Sevelnord investment.

The future of the Sevelnord facility had been in doubt since Fiat notified PSA 16 months ago that it would withdraw from the joint venture in 2017. Fiat agreed in July to sell its 50% stake to PSA for a nominal amount by Dec. 31. PSA will continue to produce the Fiat Scudo van through 2016.