Peugeot 108 could rival Up! and 500 sub-$15K city cars

The Peugeot 108 sub-light car is looking a strong bet to take on sub-$15,000 rivals in Australia sometime after it goes on sale in 2014.

Peugeot Australia says it will prepare a business case study for the entry-level Peugeot once it is officially revealed with European pricing and specifications.

The French brand wanted to bring the car’s predecessor, the 107 (below), to Australia but was thwarted by a number of issues such as limited supply and the lack of an automatic gearbox.

Peugeot Australia is looking at all product options, however, to rekindle local sales that peaked at 8807 in 2007 but are heading for a sixth successive year of decline â€" to about 5000 units.

Profit margins are notoriously small in the ultra-price-sensitive area of the market where the Peugeot 108 would sit, but the company believes it’s important to create opportunities to get people into the brand early.

“That’s one of the many ways of approaching this.. in terms of opening the doorway to customers in terms of conquesting customers who wouldn’t normally consider buying a Peugeot,” said Peugeot Australia’s national marketing manager, Dimitri Andreatidis.

“And an entry-level model like that 1-series would definitely offer that opportunity.

“Once the details [of the Peugeot 108] are confirmed, we’re in the position to conduct the study with the information in terms of pricing and spec so we can take it further.”

The 108 would sit below the Peugeot 208 city car that starts from $18,490.

Peugeot Australia has noted the success Fiat has had with the 500 since creating a new $14,000 driveway version called Pop. Volkswagen is also competing below $15,000 with the Up!.

The Peugeot 108 will be built in the Czech Republic and like its predecessor will share its underpinnings and major body panels with models from Toyota and sister brand Citroen.

The 107 formed a trio of differently badged sub-light cars with the Citroen C1 and Toyota Aygo. A spy photo of the upcoming new C1 is featured in our main image, showing a profile shape that will be near identical to the 108′s.

The five-door Peugeot 108 will be slightly longer than the 3420mm 107, and a wheelbase increase is also expected to help create more cabin space.

Australia’s sub-light car category is set to become extremely busy in coming years, with the major South Korean brands also looking closely â€" with the Hyundai i10 and Kia Picanto.