Citroën India, What's Up?

Citroën India, What's Up?

When Citroën, the esteemed French automaker, announced its entry into the Indian market in 2019, expectations were high. With a rich legacy of innovation and design, the brand aimed to carve a niche in one of the world's most dynamic automotive landscapes. However, as the years unfolded, Citroën's journey in India became a narrative of challenges and introspection. What went wrong? Let's delve into the intricacies of Citroën's Indian expedition.

A Grand Entry with Lofty Ambitions

In 2019, Citroën unveiled its plans for the Indian market, marking its third attempt to establish a foothold in the country. Collaborating with the CK Birla Group, the company set up joint ventures to facilitate vehicle assembly and powertrain manufacturing. This strategic move was designed to leverage local manufacturing capabilities, ensuring competitively priced vehicles tailored to Indian consumers' preferences.

Diverse Product Portfolio

Citroën introduced a blend of global models and region-specific vehicles to cater to the diverse Indian audience:

  • C5 Aircross SUV: Launched in April 2021, this premium SUV emphasized comfort and advanced features, targeting discerning customers.
  • C3 Hatchback: Debuting in 2022, the C3 aimed at the mass-market segment, boasting over 90% localization to offer an affordable yet feature-rich option.
  • ë-C3 Electric Hatchback: Introduced in February 2023, this model marked Citroën's entry into India's electric vehicle market, offering a range of 320 km per charge.
  • C3 Aircross SUV: Unveiled in September 2023, this midsize SUV sought to capture a share of India's growing SUV market.
  • Basalt Coupe SUV: Launched in 2024, the Basalt targeted niche segments, blending sporty aesthetics with utility.

Sales Performance: A Reality Check

Despite the diverse lineup, Citroën's sales figures painted a concerning picture:

  • 2022: The company recorded 6,588 registrations, a significant increase attributed to the introduction of new models.
  • 2023: Sales figures fluctuated, with monthly sales peaking at 1,386 units in September but averaging around 506 units per month.
  • February 2025: Total sales stood at 268 units, with the C3 model contributing 110 units, indicating a 54.55% month-on-month decline.

Cumulatively, since its market entry in April 2022, Citroën India sold over 17,000 vehicles up to February 2024.

The C5 Aircross Conundrum

A glaring concern was the dismal performance of the C5 Aircross SUV. In the 12 months leading up to November 2024, only 10 units were sold, with six months recording zero sales.

December 2024 saw a mere single unit sold, bringing the six-month total to just seven units. This premium SUV, despite its advanced features and comfort, struggled to find takers in the Indian market.

Identifying the Pitfalls

Several factors contributed to Citroën's underwhelming performance in India:

Pricing Strategy: The C5 Aircross, priced between ₹36.91 lakh to ₹39.99 lakh, positioned itself in a highly competitive segment dominated by established players offering more value for money.

Feature Expectations: Indian consumers have a penchant for feature-rich vehicles. Feedback indicated that some Citroën models lacked certain features compared to competitors, diminishing their appeal.

Perception of Cost-Cutting: Market observers believed that Citroën's approach focused excessively on cost-cutting, potentially compromising aspects valued by Indian buyers.

Distribution Network: As of 2023, Citroën planned to expand its touchpoints from 50 to 200 within the year. However, a limited distribution network initially hampered accessibility and customer engagement.

Strategic Initiatives and the Road Ahead

In response to these challenges, Citroën undertook several strategic measures:

  • Enhanced Localization: By emphasizing local manufacturing, Citroën aimed to reduce costs and align products more closely with local tastes.
  • Electric Vehicle Focus: Aligning with the government's push for electric mobility, Citroën committed to producing EVs in India for the domestic market.
  • Portfolio Diversification: Introducing models like the Basalt Coupe SUV to cater to diverse consumer segments showcased Citroën's intent to appeal to a broader audience.

Thierry Koskas, Citroën's CEO, expressed aspirations for India to become the brand's second-largest market within five years, targeting annual sales of 100,000 units. Achieving this ambitious goal necessitates a deep understanding of the Indian consumer psyche, competitive pricing strategies, and an unwavering commitment to quality and features.

Conclusion

Citroën's Indian journey underscores the complexities international automakers face when entering a diverse and price-sensitive market. While the brand brought a legacy of innovation and design, aligning with Indian market dynamics proved challenging. Addressing pricing strategies, enhancing feature offerings, and expanding the distribution network are pivotal steps toward capturing the hearts of Indian consumers. With introspection and adaptive strategies, Citroën holds the potential to rewrite its Indian narrative and establish a formidable presence in the subcontinent's automotive arena.