APRIL 26, 1999

Peugeot's new motor sport resolve

PSA PEUGEOT CITROEN - the parent company of Peugeot - says it is sticking to its policy of remaining independent, despite the consolidation going on in the automobile industry. And the company seems to be gearing up to use success in motor sport as a spur to future sales.

The company chairman Jean-Martin Folz says that cost-cutting, coupled with expansion in Latin America and Asia will enable the company to survive. As a result the Peugeot Formula 1 program takes on a new importance as a marketing tool. With the company planning a brand new small and light V10 engine for next season, it looks certain that the current deal with Prost Grand Prix - which runs out at the end of 2000 - will be extended.

At the same time Peugeot is accelerating its involvement in the World Rally Championship with Francois Delecour and Gilles Panizzi driving the new Peugeot 206 model. Although there will only be a limited program of events this year, PeugeotÊSport has managed to convince the FIA to let the cars score World Championship points.

Peugeot's sister company Citroen last week stunned the rally world when Philippe Bugalski won the World Championship Rally of Catalunya, beating the Toyota, Subaru, Ford and Mitsubishi factory teams in his Citroen Xsara Kit-Car. It is the first time in the 21-year history of the World Rally Championship that a car which was not entered in the World Championship has won an event.