June 22, 2005

PSA Peugeot Citroën and BMW Group join forces to build engines

Douvrin, France - PSA Peugeot Citroën and BMW Group plan to produce a new family of small, four-cylinder gasoline engines used in Mini, Peugeot and Citroën vehicles.

The main engine parts will be machined exclusively at PSA Peugeot Citroën's Douvrin plant in Northern France, with engine assembly divided between each partner's facilities. Mini engines will be assembled at Hams Hall in the U.K.

As part of the project, a complete production module will be brought on line in late 2005 at the Française de Mécanique plant in Douvrin. The module is based on the development of a highly integrated, independent production unit that will bring together the machining lines for the main components, such as cylinder heads, crankcases, crankshafts and connecting rods, with the assembly lines. The module will cover approximately 60,000 square metres and be capable of producing 2,500 units per day, utilizing 1,120 employees working in four shifts.

The Hams Hall plant will assemble engines for future variants of Mini, and its location near the BMW Group's Oxford plant will allow for flexible management of just-in-time sequence deliveries, resulting in a reduction of stock levels and delivery times.

The cooperation dates from 2002, when PSA Peugeot Citroën and BMW Group announced their intention to jointly develop and produce a new range of small, high-technology gasoline engines. At maximum capacity, the overall annual production will reach one million units.

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