Guangzhou Peugeot Automobile Company

Guangzhou Peugeot Automobile Company

Traded as	GAC Peugeot
Industry	Automotive
Founded	1985
Defunct	1997
Fate	Integrated into GAC Honda in 1997
Headquarters	Guangzhou, Guangdong , China
Products	Automobiles

The Guangzhou Peugeot Automobile Company (GPAC) was a vehicle manufacturer situated in Guangzhou, China. It functioned as a joint venture between the municipal government of Guangzhou and the French carmaker PSA Peugeot Citroën under the Peugeot marque.

Established on 26 September 1985, the enterprise halted its operations in March 1997 following Peugeot’s withdrawal from the partnership. Meanwhile, PSA’s affiliated brand Citroën successfully collaborated with Dongfeng beginning production in 1992 (Dongfeng-Citroën), and Peugeot re-entered the Chinese market via Dongfeng in 2002.

After GPAC’s dissolution, Honda joined forces with the Guangzhou authorities to create Guangqi Honda Automobile.

History

As one of the pioneering Sino-foreign automotive collaborations, GPAC manufactured approximately 100,000 units throughout eleven years. The product range comprised two models—the Peugeot 505 (introduced in 1980) and the Peugeot 504 (originating in 1968)—which were mainly distributed through fleet sales targeting government departments and taxi operators starting from 1989.

Conflict

The enforced localization of components intended to nurture domestic suppliers generated friction. Although initially beneficial for Peugeot due to parts sales, the growing reliance on inexperienced local manufacturers resulted in diminished product standards, leading to consumer dissatisfaction within China. Despite opposition, Peugeot repatriated its earnings, and cultural disagreements endured.

By 1993, GPAC’s aging vehicle lineup was overshadowed by competitors; sales plummeted to 2,544 units while Shanghai VW sold around 146,000 vehicles—capturing about fifty percent of market share. In 1996, the Guangzhou government decided to terminate its alliance with Peugeot. Subsequently, Peugeot exited in 1997, and Guangzhou Automotive initiated a new joint venture with Honda.

Ownership

PSA Peugeot Citroën owned a 22% shareholding, with total foreign equity ranging between 26% and 30%.