In order to make the market passenger cars and light commercial vehicles, a joint venture was formed on Friday by Automotive group, PSA Peugeot-Citroen and China's Chang'an Automobile Group.

The move is intended to permit the French Company to cash in on the flourishing Chinese automobile market and make it the main player. It is also part of Peugeot-Citroen's plan to lessen its reliance on the mature European market for the immensity of its sales and proceeds.

Documents were signed by Peugeot-Citroen, Chief Executive Officer, Philippe Varin, who is creating the 50-50 mutually owned Company with Xu Bin, President of China South Industries Group Corp., Chang'an's chief shareholder, at a ritual in Paris.

A preliminary investment of EUR935 million that will have an early annual production capability of 200,000 vehicles and engines at Chang'an's plant at Shenzen, in Guangdong province, is being made by the two Companies.

A new assembly line at the facility will be constructed that would make cars, and the existing mothballed assembly line used to build light commercial vehicles will be renovated by the partners.

The launch of Citroen’s new DS range, characteristic vehicles with premium-type features and finish will be seen in china. The foremost of those, the sub-compact DS3, was initiated in March in Europe and is selling so well that Peugeot-Citroen has already determined to augment the manufacture rate.

CEO Varin has asserted that the Company would import the DS3 into China in kit shape. Other, larger, DS models would be pioneered later and produced locally, he added.