Peugeot India boss recalls the abrupt adieu of 1997

To those familiar with Peugeot’s first outing in India, the name Jacques Manlay will immediately strike a chord. He was Managing Director of the PAL-Peugeot joint venture and steered it through some of its most turbulent periods through the 1990s.

These included a labour crisis at its Kalyan plant near Mumbai, a shortage of kits to assemble the 309 model and finally a face-off with its Indian partner, Premier Auto, which required legal intervention.

Finally when Peugeot was all set to restart its India innings on a stronger note, headquarters in Paris decided that enough was enough and down came the shutters at the Kalyan facility. This was in November 1997 and there was little Manlay could do but bid adieu to what seemed a promising new chapter for the company. Consequently, he will be remembered as the last chief of Peugeot’s first innings in India.

It may sound cliched but Manlay has not really changed much when we meet in Paris after nearly two decades. He has retired from Peugeot but is still actively involved in a host of initiatives in the automotive space. He also has fond memories of India and believes the country is in good hands with strong leadership at the political level.

Are there any regrets though about how everything ended on a sour note for Peugeot in India? Would things have been different had the company stayed on and built on its early bird advantage? Manlay is not entirely sure if Peugeot would have been in a domineering position if it had chosen to continue its India innings.

“I remember being particularly impressed with Hyundai which had also entered the country in 1996. The company was focusing extensively on localisation since this was imperative for a cost-effective operation to be in place,” he recalls. And the results are there for all to see with Hyundai emerging the strongest rival to Maruti in India.

In contrast, Peugeot (like other European automakers) was still heavily reliant on imported kits from overseas which would then be assembled at its Kalyan plant. Manlay believes this comparatively casual attitude had to do with the fact that the company, like other global automakers, was doing well in its home market. India was a different kettle of fish and there was really no compelling reason to step on the gas.

He has a point given the experiences of General Motors and Fiat which have been around in India for decades but have frittered away growth opportunities only to languish with minuscule market shares. Peugeot may well have been in the same boat simply because some carmakers had no India-specific strategy unlike Hyundai or Suzuki. Manlay has some fond memories of his stint here especially the bureaucracy and layers of paperwork. For instance, he was truly bewildered by the maze of procedures required for a driving licence. He still recalls people seated in small rooms and going through sheaves of documents. All this seemed bizarre considering that all that was needed was a picture to have a licence issued!

It also amused Manlay to deal with elaborate replies from colleagues backed with statistics galore when all he wanted was simple clarifications on issues relating to taxation and sales numbers. “I would wonder what to make of those exhaustive notes scribbled on paper,” he reminiscences with a laugh.

Then there are memories of those occasional drives from his Bandra home to the Kalyan plant which would strictly be on weekends to avoid the traffic. He is pleased to know that road building activity is picking up pace in India since it is an absolute necessity for its automobile industry.

“It is also important for the government to ease the pressures of doing business. I remember the endless levels of bureaucracy during my stay and this is something that has hopefully changed.

Multinationals would otherwise find it very difficult to do business in India,” says Manlay. He believes the Goods and Services Tax will be a huge boon when it becomes a reality next year. Manlay is also aware that Peugeot is planning a return to India over the next couple of years. “It is not for the first time though. There was an alliance planned with Tatas some years ago followed more recently by the Gujarat investment plan,” he reminds me.

According to Manlay, the top priority for Peugeot in its second innings (scheduled to begin in 2018) is to focus on localisation first if it is keen on building a strong India presence. While driving home the Hyundai example again, he reiterates that it is otherwise impossible to make a dent in this intensely competitive market.

Manlay visited India recently on official work which took him to Chennai. The days spent were a little too brief for him to observe the changes since the time he left 18 years ago. What was clear though was the change in the overall automobile industry profile.

When he was summoned back to Paris after the jinxed India chapter of 1997, Manlay worked at headquarters for some years but was keen on a stint overseas before his eventual retirement. This was what took him to Iran for a solid eight years where he enjoyed every minute of his stay. It was the perfect send off for a man who spent half of his 40-year-tenure at Peugeot overseas in countries such as Nigeria, Brazil, Iran and, of course, India where he would have ideally liked to have a longer stint.

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