PRESS KIT BRAZIL March 2010

CONTENTS


Pages


PSA Peugeot Citron in Brazil - Key Dates 2



Production Facilities in Brazil 4



Peugeot and Citron in Brazil 6



PSA Peugeot Citron Sales in Brazil 8



The automobile market in Brazil 9



The fuel situation in Brazil 11



Peugeot ONF Carbon Sink 15




2




PSA Peugeot Citron in Brazil - Key Dates




May 1991 January 1992
Automobiles Citron signs an agreement with a Brazilian importer and Automobiles Peugeot
creates a sales & marketing subsidiary, Peugeot do Brasil Automveis Ltda.

September 1997
Peugeot Citron do Brasil Automveis S.A. is set up.

January 1998
Jean-Martin Folz, Chairman of PSA Peugeot Citron, signs an agreement with the Governor of
the state of Rio de Janeiro for the construction of a plant in Porto Real.

January 1999
Jean-Martin Folz and the Governor of the state of Rio de Janeiro lay the cornerstone of the PSA
Peugeot Citron plant in Porto Real.

October 2000
Automobiles Citron creates sales & marketing subsidiary Citron do Brasil.

December 2000
Launch of series production of the Citron Xsara Picasso.

February 1, 2001
The Porto Real plant is opened by Jean-Martin Folz in the presence of the President of Brazil
and the governor of the State of Rio de Janeiro.

April 2001
Launch of series production of the Peugeot 206.

March 2002
The Porto Real engine plant comes on stream, with production start-up of 1.6-litre petrol
engines.

April 2003
Launch of series production of the Citron C3, the third PSA Peugeot Citron model to be built
in Brazil.

August 2004
Production of 1.4-litre petrol engines begins at the Porto Real engine plant.


3

November 2004
Jean-Martin Folz kicks off production of the Peugeot 206 SW, PSA Peugeot Citrons fourth
model to be produced in Porto Real, with the President of Brazil, Luiz Incio Lula da Silva, and
the Governor of the state of Rio de Janeiro, Rosinha Garotinho, in attendance at the launch.

March 2005
The Porto Real engine plant launches production of 1.6-litre flex-fuel engines.

June 2005
The Porto Real engine plant, opened in 2002, produces its 100,000th engine.

December 2005
The Porto Real engine plant launches production of 1.4-litre flex-fuel engines.

March 2006
Series production of the Citron C3 XTR begins.

May 2006
The 300,000th vehicle rolls off the assembly line at the Porto Real plant opened in 2001 to
manufacture Peugeot and Citron models.

August 2006
Series production of the Peugeot 206 Escapade begins.

February 2007
Vincent Rambaud is appointed Chief Executive Officer of the new Latin America business unit.

November 2007
The new PSA Peugeot Citron headquarters in Brazil are opened.

December 2007
$500 million investment announced for the development and production of vehicles for the
Mercosur market.

May 2008
Production launch of 207 Mercosur

July 2009
Inauguration of the Engine Machining Unit at the Porto Real Production Centre.

February 2010
Third shift implemented at Porto Real.

March 2010
Announcement of an investment of 1.4 billion reals (530 million euros) over 3 years to design
and produce vehicles in Mercosur.

May 2010
Market launch of the Peugeot Hoggar (pick-up version of 207 Mercosur).

4



Production Facilities in Brazil


The Porto Real Assembly Plant

Brief background

PSA Peugeot Citrons Porto Real plant in early 2001 launched series production for the two
marques almost simultaneously with the Citron Xsara Picasso and Peugeot 206.

Surface area: 146,000 square metres Production capacity:
- Production capacity of 160,000 vehicles per year based on three shifts.
- In 2009, the plant produced 111,200 vehicles.
- 70% to 85% of the sourcing is local
Site dedicated to Platform 1: Peugeot 207 Mercosur, 207 SW Mercosur, 207 Mercosur saloon,
Hoggar (207 pick-up)
Citron Xsara Picasso and C3

Workforce
- Porto Real production centre: 3,700 direct employees
- Technopole, dedicated to the local supply of spare parts: 800 employees
=> In all, since opening in Rio Janeiro state in 2001, the Porto Real Production Centre has
created more than 4,500 direct or indirect jobs.

Defining characteristics
- The Porto Real plant has an exceptional work safety record.

- It obtained ISO 9001:2000 certification in April 2004 and has also been awarded Highly
Protected Risk certification. This is the highest level of recognition that can be awarded to a
company for its fire prevention and protection policies. In 2002, the sites environmental
management system obtained ISO 14001 certification, and the certification has been renewed
every year since then.










5


The Porto Real Engine Plant

Brief background

Opened in March 2002 and located on the same site as the vehicle assembly plant, the Porto
Real engine plant began by producing 1.6-litre petrol engines. In 2004, 1.4-litre petrol engines
were added. The next year, the plant started producing1.4-litre and 1.6-litre flex-fuel engines to
meet demand for this technology in the Brazilian market. Currently, the plant produces engines
for Peugeot and Citron vehicles built in Brazil, as well as for export.

In July 2009, the Group opened the Engine Machining Plant on the grounds of the Porto Real
engine plant. The new unit produces cast iron engine blocks and aluminium cylinder heads for
the 1.6-litre flex-fuel and petrol engines. Total production capacity is 100,000 cast iron engine
blocks and 80,000 aluminium cylinder heads per year with three shifts.

Dimensions: 8,600 m
2
.




Production:
- Production capacity of 220,000 engines per year
- In 2009 the plant produced 152,000 engines
- In 2009 the plant produced its 700,000th engine since March 2002.

Engines produced: 1.4-litre and 1.6-litre petrol engines as well as 1.4-litre and 1.6-litre flex-fuel
engines.

Workforce: 200.




















6
Peugeot and Citron in Brazil

Peugeot

Peugeot has grown rapidly in Brazil since setting up business there in 1992. The marque is
currently ranked seventh in the market.

Brief background

June 2001: Launch of the 1-litre Peugeot 206 in the Brazilian market. Built at the Porto Real
plant, this was the first Peugeot model to be produced in Brazil.

2002: Start of production of 1.6-litre 16 valve engines, which strengthened the marques
Brazilian identity and accelerated its integration in the local automobile industry.

Since then, the marque has constantly expanded its market share.

2005: Launch of the Peugeot 206 SW, the second Peugeot model to be produced in
Brazil.
Launch of the 1.6-litre flex-fuel engine, positioning Peugeot in a particularly
promising segment of the Brazilian market, followed in January 2006 by the
introduction of a 1.4-litre version.

2006: Market launch of the Peugeot 206 Escapade, designed and produced in Brazil.
Launch of the new, restyled Peugeot 307 and the Peugeot 307 Sedan, both
produced in Argentina.

2007: Market launch of the Peugeot 206 automatic transmission model

2008: Market launch of the Peugeot 207 Mercosur

2010: Market launch of the Hoggar (207 pick-up).

2009 sales

With 81,860 cars and light commercial vehicles sold in 2009, representing a 2.7% market
share, Peugeot sales fell 1% in 2009 on 2008.

Network: 153 dealers.

Models sold:
Cars: Peugeot207 Mercosur hatchback and 207 SW Mercosur , 307 hatchback, 307 Sedan,
407 Sedan and SW.
Light commercial vehicles: Peugeot Partner van, Boxer Combi and Boxer Minibus.

Peugeot vehicles on the road in 2010: around 650,000

Vehicles produced in Brazil: 207 Mercosur hatchback, 207 SW Mercosur, 207 Passion
(three-box), Hoggar (207 pick-up) and Boxer (PSA Peugeot Citron/Fiat Iveco partnership)
Vehicles produced in Argentina: 307 hatchback, 307 Sedan and Partner

7

Citron

Present in Brazil since 1991, Citron is now ranked ninth in the local market.

Brief background

February 2001: Launch of the Citron Xsara Picasso, the marques first model to be
produced in Brazil.

April 2003: Market launch of the Citron C3.

August 2007: Launch of the restyled Xsara Picasso.

September 2007: Launch of the Citron C4 Pallas, manufactured in Argentina.

August 2008 : Launch of the restyled C3.

March 2009: Launch of the C4 hatchback, manufactured in Argentina.

2009 sales

With 69,300 cars and light commercial vehicles sold in 2009, representing a 2.3% market share,
Citron achieved 1.5% growth in Brazil compared with 2008.

Network: 131 dealers.

Models sold:
Cars: Citron C3, C4 5-door, C4 Pallas (three-box), Xsara Picasso, C4 Picasso, C5.
Light commercial vehicles: Citron Relay Minibus

Citron vehicles on the road in 2010: around 330,000

Vehicles produced in Brazil: Xsara Picasso, C3 and Relay (PSA Peugeot Citron/Fiat Iveco
partnership)

Vehicles produced in Argentina: C4 Pallas, C4 5-door, Berlingo












8


PSA Peugeot Citron Sales in Brazil




2009
Cars and Light Commercial Vehicles


Units
Change
2009 vs 2008
March Total 1,011,000 + 12.5%


Units
Change
H1 2009 vs H1 2008
Market share
H1 2009
PSA Peugeot Citron 151,160 + 0.1% 5.0%
Peugeot 81,860 - 1.0% 2.7%
Citron 69,300 + 1.5% 2.3%



2008
Cars and Light Commercial Vehicles


Units
Change
2008 vs 2007
Market as a whole 2,675,600 + 14.1%


Units
Change
2008 vs 2007
Market share
2008
PSA Peugeot Citron 151,000 + 17.7% 5.7%
Peugeot 82,700 + 5.1% 3.1%
Citron 68,300 + 37.8% 2.6%





9



The automobile market in Brazil


Background

The first cars on the road in Brazil at the end of the 19
th
century were imported. Ford was the
first carmaker to officially set up operations in the country, in 1919, assembling CKD kits
imported from the United States. General Motors followed suit six years later. However, it wasnt
until 1949 that local production began, when the national motor company FNM started turning
out trucks under license from Isotta Fraschini, and then Alfa Romeo. In 1956, the first passenger
cars fully manufactured in Brazil were launched by Brazilian companies working under license
from European marques.

During this period, the federal government imposed heavy taxes on imported vehicles to
stimulate local production. This encouraged several carmakers to set up operations in Brazil. In
the early 1970s, the market was protected even further by a ban on imported vehicles.
Volkswagen, Ford, General Motors (Chevrolet) and Fiat were the only manufacturers producing
Brazilian models at the time. The ban on imports was not lifted until the early 1990s, a period of
strong economic growth. This fueled a boom in the automobile market and quickly attracted
several companies to the area. Subsequent economic crises severely impacted the country,
which has only really regained its stability in the past four years. This has led to a sharp upswing
in vehicle sales.

In 2006 and 2007, Brazilian market growth exceeded forecasts due to the countrys economic
stability, which set the foundation for longer-term loans and lower interest rates. In 2008, the
automobile market experienced a strong growth (+14.1%), however inferior to 2007 (+27.8%), in
particular during the second half of the year.

The 2009 year began with a downturn owing to the impact of the global economic crisis on the
Brazilian market. However, the measures taken by the federal government in November 2008 to
stimulate the economy and consumption, mainly in the automotive sector, quickly produced
results. The government reduced tax on manufactured products (the main tax on vehicles),
encouraged banks to grant loans and reduced interest rates. As a result, the Brazilian economy
and automotive sector set historic records. The Brazilian market continued to rise in the second
half and, as a consequence, vehicle sales in 2009 beat all records, up 12.5% on 2008.



10


Sales in the Brazilian market (cars and light commercial vehicles)
Vehicles sold

1000000
1500000
2000000
2500000
3000000
3500000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009


Automobile Strategy

Passenger cars in Brazil are subject to the federal tax on industrial products (IPI), which is
determined on the basis of engine size and type of fuel.

The Brazilian government reduced and, in certain cases, eliminated the IPI tax at end-2008
to encourage a decrease in vehicle prices to help the Brazilian market get over the effects of the
global economic crisis. The measure, initially planned to last three months, was maintained for
the entire 2009 year, with extremely positive results. Consistent with the governments
announcement in late 2009, the IPI reduction will come to an end on 31 March 2010.

The IPI tax will thus return to regular, pre-December 2008 levels. Cars equipped with engines
up to 1.0 litre are taxed at 7%. The rate for engines between 1.0 and 2.0 litres is 11% if they run
on alcohol or are flex-fuel and 13% if they run on petrol. Models with engines above 2.0 litres
are taxed at 18% if they run on alcohol or are flex-fuel and 25% if they run on petrol. The IPI is
8% for light commercial vehicles and 5% for trucks.

Diesel engines are banned for passenger cars to control the consumption of diesel fuel, which is
mainly imported. Diesel engines can only be used on off-road vehicles (FWD and low traction),
light commercial vehicles with a load capacity above one metric ton or intended for passenger
transport, trucks and buses.


11



Popular Car

In the early 1990s, the federal government decided to create a reduced tax for 1.0-litre engine
cars that cost less than USD7,500. These much more affordable popular cars drove strong
growth in the automobile market, with automobile sales surging from 764,000 in 1992 to 1.94
million in 1997.

Over time, the price ceiling was abandoned but the reduced tax remained in place. As a result,
1.0-litre engine cars increased their market share, particularly during economic crises. In the last
few years, however, the tax gap between 1.0-litre and 1.0-2.0 litre engines has narrowed and
less powerful models have seen their market share decrease. Even so, 1.0-litre engines still
account for 53% of total vehicle sales in Brazil.


Automobile Production

- There are 24 automobile production plants in Brazil, belonging to 16 different carmakers,
producing passenger cars, light commercial vehicles, trucks and buses.

- According to the national association of vehicle manufacturers (ANFAVEA), which includes all
carmakers in Brazil, the country has a total annual production capacity of 3.4 million units.



12

The fuel situation in Brazil


1 - Oil

Founded in 1953 by President Getlio Vargas, Petrobras is Brazils largest company and the
worlds 15
th
largest oil firm. Thanks to Petrobras technological advances and the construction of
Platform 50, Brazil became self-sufficient in oil in 2006. P-50, located in the Campos basin off
the coast of northern Rio de Janeiro State, has the highest production capacity of all the
platforms in Brazil at 180,000 barrels/day.

2 - Ethanol

Alcohol as a fuel in Brazil

The first fuel experiments were conducted in the 1920s. Taking advantage of a bumper crop,
researchers added a sugar cane derivative to petrol for the first time in the 1930s. During the
World War II oil shortage, alcohol fuel pumps were installed in the northeastern part of the
country as an alternative to coal-derived producer gas, which was widely used in the southeast.

In the early 1970s, weekend petrol rationing led the Brazilian authorities to look at sugar cane
trends and consider sugar cane-based alcohol as a possible substitute for petrol. In November
1975, the federal government, in association with Petrobras and the sugar cane-fuel industry,
created the Prolcool program to encourage the use of alcohol as a fuel. Tests demonstrated
that alcohol was a viable fuel in a 25% ethanol-petrol mix.

The Fiat 147 was the first alcohol-burning model introduced to the market, in early 1979. It was
followed in November 1979 by the Volkswagen Passat. Very quickly, all models manufactured in
Brazil were offered in ethanol versions. The boom lasted until 1987, when more than 80% of the
vehicles rolling off the assembly line had ethanol engines. Some models came exclusively in
ethanol versions, like the Fiat Oggi manufactured between 1983 and 1985.

In the late 1980s, rising sugar prices in the international market prompted sugar cane growers to
export their production, and service stations found themselves running out of ethanol. Between
harvests, many car owners had to wait in long lines to fill up their tanks. Alcohol-only vehicle
prices plummeted while petrol models came back into favour.

As a result, carmakers stopped investing in ethanol engines, and alcohol-based fuel, once seen
as a solution for the future (and a marvellous opportunity for Brazil to become a global energy
source) was marginalized. Production of alcohol-only cars ground more or less to a halt,
representing only 0.1% of total output at the end of the 1990s.


13


Alcohol-based fuel made a comeback in 2003, when Volkswagen, General Motors and Fiat
brought flex-fuel models to the market. PSA Peugeot Citron launched its first flex-fuel model,
the 206 Flex, in 2005. Honda followed with flex-fuel versions of the Fit and Civic at the end of
2006. Toyota and Mitsubishi introduced their flex-fuel models respectively in 2007 and 2008.

The share of flex-fuel vehicles continued to grow in Brazil last year, with another carmaker,
Nissan, launching models equipped with flex-fuel engines. Sales of vehicles powered by flex-
fuel accounted for 88% of total car and LCV sales in the country.

The popularity of these models has lifted demand for ethanol and helped spur rapid growth in
the Brazilian ethanol market. Whats more, the technologys success in Brazil has attracted
interest from many foreign countries who are looking for ways to reduce polluting emissions.


The Flex-Fuel Concept

- Volkswagen initiated flex technology in 2003 with its Gol model. The concept involves mixing petrol with
alcohol derived from sugar cane.
- Motorists choose the most affordable petrol-ethanol mix based on fuel prices.
- Because vehicles burn more alcohol than petrol, ethanol is more cost effective if its price is 75% or less
that of petrol.


Flex-fuel market share in Brazil


















3 - Diesel

Since the 1970s, Brazil has responded to oil crises by implementing legal restrictions on the use of diesel
by light vehicles. A 19 November 1976 order (no. 346) from the Ministry of Industry and Trade called for
a ban in Brazil on diesel vehicles with a payload of less than 1,000 kg.

Period Market share
(% of passenger cars)
Number of vehicles
sold
H1 2004 24% 107,000
H2 2004 30% 205,000
H1 2005 43% 280,000
H2 2005 70% 490,000
H1 2006 77% 743,600
H2 2006 83% 858,600
H1 2007 84% 1,020,000
H2 2007 87% 1,144,000
H1 2008 88% 1,172,000
H2 2008 87% 1,157,000
H1 2009 88% 1,231,000
H2 2009 88% 1,421,000

14


4 - Biodiesel

In 2003, the Office of the President set up an inter-ministerial working group to study the use of biodiesel
as an alternative energy source. Drawing on their work, the Office of the President then implemented the
national Biodiesel Production and Use Program (PNPB), making it a strategic priority for Brazil. The
program is designed to launch biodiesel production and use in a way that is sustainable from all
standpointstechnical, economic, social (job creation) and regional (local revenues).

Despite this impetus, and even though the fuel is authorized, biodiesel is still not available in most of the
countrys service stations. Brazilian biodiesel production capacity is considered sufficient to meet
demand (biofuel output is forecast at one billion litres for 2008), but production and consumption run up
against two major roadblocks:
- The lack of standards for biodiesel use.
- Excessive taxes. In So Paulo State, for example, biodiesel is taxed at BRL0.75 a litre, putting it at a
disadvantage to ordinary diesel (BRL0.46/litre), hydrated alcohol (BRL0.38/litre) and compressed natural
gas (CNG) (BRL0.23/litre).

Nevertheless, the federal government is working to encourage greater biodiesel production and
consumption in Brazil through incentives to family farms and the development of new technologies.


PSA and biodiesel in Brazil

PSA Peugeot Citron, a specialist in biofuel technology and a major player in biodiesel in Europe, has
set up a project team to conduct research on Brazilian biodiesel, which is attracting growing interest in
the country. The goal is to work with the government to optimize Brazils energy matrix, promote
biodiesels image as an environmentally friendly fuel, and present its advantages to administrative bodies
and the press.

Backed by more than 10 years of experience with biodiesel in Europe, the Group initiated a technological
partnership in 2003 with University of So Paolos Laboratory for Development of Clean Energy
(LADETEL), which conducts research for Brazilian biodiesel producers. LADETELs work covering more
than 12 different types of oilseeds led the partners to test a biodiesel made from soy ethyl ester (B30) in
Group vehicles in a 30-70 mix with Brazilian diesel

Citron Xsara Picasso and Peugeot 206 test cars have covered more than 180,000 km without incident
using this mixture. The road test results were supported by test bench work conducted in July 2004 at
LACTECs Paran lab to get a better understanding of pollution emissions. The vehicles tested were
equipped with diesel engines manufactured by PSA Peugeot Citron that were not modified in any way.

PSA Peugeot Citron organized a symposium in September 2004 to present its biodiesel road test
results. The tests showed that pollution emissions were 16% lower on average, with a significant
reduction in particulates and carbon monoxide, with the biodiesel mix than with pure diesel.

The road test results demonstrated that the Brazilian B30 mix contributes to sustainable development
and delivers a number of benefits. These include an overall reduction in CO2 emissions and reductions in
particulates and exhaust gas, which are important factors in the greenhouse effect and air quality; lower
crude/diesel imports and promotion of renewable energies, which is good news for energy
independence; and new jobs in rural areas.


15



Phase two of the road test project in partnership with LADETEL began on 6 October 2006. It was
approved by the Inter-ministerial Executive Committee on biodiesel and included in the federal
governments official test program. Six Group vehicles are involved in the project: a Citron Xsara
Picasso, a Peugeot 206, a Peugeot Partner passenger car, a Peugeot Partner commercial vehicle, a
Citron Berlingo passenger car and a Citren Berlingo utility vehicle. Phase two is also testing new
oilseed mixes including soybean, castor beans and oil palm.

PSA Peugeot Citron joined Rio de Janeiro States RioBiodiesel program on 13 September 2006. One
focus of the program is to study different methods for making biodiesel from plant oils, as well as from
fatty acids, cooking oil and animal fat. RioBiodiesel also intends to track biofuel performance from field to
wheel. PSA Peugeot Citroen has contributed two Peugeot Boxers and two Citron Relays for road tests
using the B5 oilseed mix.


5 Compressed Natural Gas (CNG)

Brazil began testing compressed natural gas (CNG) in refineries in 1982. Buses running on CNG came
on the road in the late 1980s. Their tanks were filled in closed hangars. Ipiranga opened the first CNG
service stations in 1991, in Rio de Janeiro and So Paulo. All of the equipment was imported from Italy,
including the vehicle conversion kits.

CNG was authorized for taxis in 1992. However, there was a long waiting period at the few garages that
did kit installation and taxis had to line up at service stations to re-fuel. The authorization for passenger
cars was granted five years later. Rio de Janeiro is the main consumer of CNG in Brazil thanks to tax
breaks and the low price of CNG.

Currently, Fiat, General Motors and Volkswagen are investing in this segment. They offer to install
conversion kits at their dealerships without cancelling the factory guarantee. In addition, Fiat and General
Motors offer trifuel and tetrafuel models that can also run on CNG.























16

Peugeot ONF* Carbon Sink

A substantial, long-term investment

Scientific sponsorship program in the Amazon
10 million budget, entirely financed by Peugeot
40-year lifespan, from 1998 to 2038

The So Nicolau tree farm: a model development combining reforestation, natural forest
management and pasturelands

Property acquired in 1999
10,000 hectares (24,710 acres), of which 7,000 hectares (17,297 acres) of forest, 2,000
hectares (4,942 acres) of pastureland, and 1,000 hectares (2,471 acres) of deteriorated
riparian vegetation
2,000 hectares of reforestation, of which 200 hectares (494 acres) to replace deteriorated
riparian vegetation
Introduction of 1,500 head of cattle in the reforested area.
Development plan for the 7,000 hectares of forest combining reasonable harvesting and
preservation of fragile/highly biodiverse areas (creation of a privately-owned nature reserve,
or RPPN).
Integrated tree farm with a capacity of 50,000 plants
Reception capacity of 80-100 people
1 km landing strip certified by the civil aviation department
50 km of roads with bridges and embankments

Large-scale reforesting with a wide variety of species

2,000 hectares reforested
2 million trees planted
Satisfactory (and rising) success rates: 70% in 1999; 90% from 2001
More than 50 species planted, of which 49 native species (only one exotic Tectona
Grandis)
Best performing native species: Ficus Gameleira, Astronium Urundeuva, Tabebuia
Pentaphylla and Chorysia Sepciosa

Carbon gain

Projected carbon gain for 1998-2038:
15 tCO2/hectare/year, or 15 x 2000 x 40 = 1,200,000 tCO2