On this day in 1991, in a letter to around 150 of its United States franchisees, the French automaker Peugeot (manufacturer of both Peugeot and Citroen cars) announces that it will stop producing cars for the U.S. market as of the following September after five years of steadily decreasing sales.
Peugeot's founder, Armand Peugeot (1849-1915), came from a large family of French industrialists whose firm, Les Fils des Peugeots Freres, was one of the country's largest makers of tools in the late 19th century. By 1886, Armand Peugeot was the leading manufacturer of bicycles in France. He had become interested in the development of the automobile very early on and met with the German engineer Gottlieb Daimler, a pioneer in the field, among others. In 1890, Peugeot formed his own automobile company, which was incorporated six years later as Societe des Automobiles Peugeot, based in Paris.
By 1925, the company had produced 100,000 cars, and by the beginning of the 1970s it was the second-largest manufacturer in France. In 1976, the French government funded the sale of the automaker Citroen SA to a group that included Peugeot. Two years later, the resulting holding company, PSA Peugeot Citroen, bought the European car- and truck-manufacturing facilities and other subsidiaries of Chrysler, then America's third-largest car company, and rebranded them as Talbot. The acquisition made PSA the second-largest auto manufacturer in Europe, behind only Volkswagen of Germany. (Mired in serious financial difficulties at the time, Chrysler later sold off its facilities in Latin America, Australia and Japan before receiving $1.5 billion in federal loans in 1980.)
As the 1980s drew to a close, however, Peugeot's success in Europe and the rest of the world failed to translate into healthy sales of the brand's vehicles in the U.S. market. According to figures reported in The New York Times, Peugeot sold 4,261 cars in the United States in 1990 (about 70 percent of them the 405 sedan) compared with 14,336 in 1986. In total, Peugeot produced 1.4 million cars that year and sold the bulk of those in the European market. A spokeswoman for the company estimated that there were still about 60,000 of its vehicles still on the road in the United States by August 1991, and that Peugeot's American operations would continue to supply parts and service for those vehicles.
Despite its continuing absence from the U.S. car market, Peugeot remains one of Europe's leading automakers, as well as a major producer of bicycles, motorcycles and scooters around the world.