Three new minicars that PSA/Peugeot-Citroen and Toyota will build at their Czech joint-venture plant will not compete on price with Renault's low-cost Logan.
Peugeot's 107, Citroen's C1 and the Toyota Aygo will cost more than Renault's Dacia-branded Logan, said Frederic Saint-Geours, Peugeot managing director.
Renault will sell the Logan for E7,500 in western Europe and for E5,000 in developing countries.
"We tried to see if it was possible to have a real car at this level," said Saint-Geours. "But we realized we could not do it, even with the expertise of Toyota."
Saint-Geours declined to reveal the target price for either the 107 or its sister models, but sources say they will be priced about E8,500.
Thierry Dombreval, Toyota Motor Europe senior vice president for sales & marketing, said the three brands will price their new small cars independently within their own individual model ranges.
PSA and Toyota will build 300,000 cars a year at their joint venture plant in Kolin, 60km east of Prague, starting next summer. Output will be split equally among the three brands.
About 80 percent of the cars produced in Kolin will go to western European markets with the rest sold in central Europe, said Masatake Enomoto, president of Toyota Peugeot Citroen Automobile Czech.
PSA and Toyota chose the Czech Republic for the plant because of its low wages, skilled labor and good access to western European markets.
Renault is building its Logan in Romania and will add production in other low-cost labor markets such as Iran, Russia and China.
Said Saint-Geours: "The labor costs are higher than Romania, but the Czech Republic has a very good location in central Europe. There are suppliers already in the area. They know how to develop and build cars there."
– Lyle Frink and Wim Oude Weernink contributed