I am very pleased to be here today with Sergio Marchionne to present the new family of commercial vehicles developed through our cooperation with Fiat. Introducing new models is always an exciting time for a carmaker, but today's event is even more important because it provides a perfect illustration of a number of the key cornerstones of our strategic vision: a strategy of targeted cooperation agreements; a will to be a leader in the light commercial vehicle market; and a commitment to develop innovative products and to revitalize our vehicle ranges.

1 – A strategy of targeted cooperation agreements

Dedicated cooperation ventures with other carmakers allow us to share costs and increase volumes for clearly identified projects, while enabling both partners to maintain their independence. These agreements represent an important lever for expanding the Peugeot and Citroën vehicle ranges. PSA Peugeot Citroën is currently involved in seven of these cooperation agreements, which cover not only vehicle bases but also mechanical sub-assemblies and represent a growing percentage of sales—approximately 20% of our total. Our cooperation with Fiat can be considered a textbook example of this strategy for several reasons—its longevity, its scope and its relevance.

First, its longevity, which is unique in the history of the automobile. Our agreement with Fiat, which dates from 1978, entered an important new phase in 1994 with the inauguration of the Sevelnord plant . In 2002, we extended our cooperation on commercial vehicles until 2017. This longevity demonstrates—if any proof was necessary—the success of our cooperation, the solid relations between the partners and the benefits it delivers for our future development.

Second, the scope of our agreement. Originally based on a single light commercial vehicle platform developed and produced under Fiat's leadership, our cooperation was then expanded to include a second platform intended for MPVs and mid-sized commercial vehicles. These vehicles were designed and produced under PSA Peugeot Citroën's management in the Sevelnord plant in Valenciennes. More recently, in March 2005, the two partners signed an agreement with Tofas to develop and produce a third family of small commercial vehicles scheduled to rollout in 2008 and which will create a new market segment. From 2008, more than half a million vehicles a year will be produced through our cooperation agreement with Fiat, of which over half will be for PSA Peugeot Citroën.

Third, the relevance of our cooperative venture. Our agreement covers vehicles that meet the specific needs and expectations of commercial vehicle customers. From large-capacity vans like the Citroën Dispatch and Peugeot Boxer, to mid-size vans like the Citroën Relay and Peugeot Expert and to the more recent project to develop a small van for the entry-level segment.
 

Each model developed through the cooperation agreement has enabled us to respond more effectively to the needs and expectations of contractors and companies alike. We could not produce such a wide range of commercial vehicles on our own. By allowing us to share skills, costs and resources, our cooperation with Fiat provides the opportunity to expand our portfolio and thus to strengthen our market position.

2 – PSA Peugeot Citroën, the European market leader in light commercial vehicles

Reinforcing our position in the European commercial vehicle market is our second strategic objective and one we feel is important for our future growth.  We have been the European market leader in the light commercial vehicle segment since 1997. In 2005, segment sales for the first time surpassed two million vehicles, of which 370,000 units for PSA Peugeot Citroën, an 18.5% share. About ten years ago, we ranked third with a 14% share but between 1995 and 2005 we grew twice as fast as the market, doubling our sales during the period.

This performance demonstrates that our vehicle range is well aligned with market needs. We have developed our commercial vehicle range either on our own, as with the Citroën Berlingo and Peugeot Partner vans, or in partnership with Fiat.  Our goal is always the same—to be a major player in each commercial vehicle family. In small vans, like the Citroën Berlingo and Peugeot Partner, we're top-ranked in Europe with a 2005 market share of 30%.

Through our partnership with Fiat, we rank third in Europe in compact vans like the Citroën Relay, Peugeot Expert and Fiat Scudo, with an 18% share and first in large vans like the Citroën Dispatch, Peugeot Boxer and Fiat Ducato, with over 25% share.  In the years ahead, we intend to totally revitalize our range, with the goal of strengthening our leadership in an increasingly competitive marketplace. In 2005, the average age of the models in our commercial vehicle range was 9.3 years. It will drop to 7.4 years in 2007 and 2.2 years in 2009, one of the youngest ranges in our history. The first step in revitalizing our commercial vehicle range, the new large van that we are unveiling today, has a number of important innovative features.

3 – A wide range of innovative vans

Our all-new van, which replaces the Citroën Dispatch, Peugeot Boxer and Fiat Ducato, represents an overall investment of roughly €1.1 billion. This investment should enable the model not only to remain Europe's best-selling van but also to improve its competitive position. The new Citroën Dispatch/Peugeot Boxer and Fiat Ducato is designed to outperform its predecessor, of which more than two million units were sold between 1994 and 2006. To achieve that goal, the new vehicle has two important advantages a state-of-the-art production system and outstanding product features.

In a few minutes, the plant manager will explain the investments made in our joint facility, which is managed by Fiat. I would just like to say that the plant is the biggest light commercial vehicle production facility in Europe. The new model's second advantage is the ambitious, innovative specifications prepared by the marketing teams. Three sections in particular are worth mentioning:

- First, the vehicle range is broad and varied, and load capacity has been increased in terms of both total weight and volume. To illustrate the variety, I will only give you one example the new vehicle is being offered in three times as many body types as the previous generation. Thanks to this varied range, our marques will each offer a large number of versions to provide contractors and companies with vehicles that meet their specific needs.

- The vehicles' second advantage is that they feature remarkable styling, with a contemporary powerful exterior demonstrating robustness, along with the ease of use and flexibility that contractors require. They have modern, well-lit, attractive cabins like passenger cars and offer a comfortable driving position similar to that of a saloon.

- The third advantage is their road performance, handling, comfort and features, which represent a considerable improvement over the models they are replacing. They are equipped with airbags, all-wheel disk brakes, ABS, ESP and air-conditioning; the kind of comfort and safety features found in passenger cars. This new family of light commercial vehicles will be powered by common-rail, direct-injection HDi diesel engines that deliver high fuel-efficiency and low emissions. Compared to the previous generation of common-rail engines, fuel consumption has been reduced by nearly 10% and the time between maintenance checks has been increased by 30%. These two parameters make the engines less expensive to use, an important criterion for both contractors and companies.

So, as you can see, this new vehicle, the first model in our revitalized commercial vehicle range, has all the advantages needed to surpass the outstanding results produced by the Peugeot Boxer and Citroën Dispatch. Thank you for your attention.