PSA Peugeot Citroen will remain in the Midlands for "many, many years" its UK head said yesterday.
Pierre Louis Colin, managing director of Peugeot UK, said Coventry remained at the heart of the firm's operations, despite closing down its manufacturing operation at Ryton last year.
He was speaking as the carmaker, which still employs around 1,000 people in Coventry dug the first foundations of its new technical centre. The centre, along with a new headquarters building, is due to be completed later this year and become fully operational by next spring.
The new buildings, which will replace the current headquarters and technical centre at the Stoke Aldermoor site, represent a #25 million investment by the French carmaker.
Mr Colin said: "It's very simple. We have based our national UK operations in Coventry since we came here in 1982, and since then we have always considered Coventry as our base in the UK.
"We have all the expertise and all the people needed for the business and the brand. We see no reason at all why we should move anywhere else. We like the area, it is the heart of the UK automotive industry.
"It makes lots of sense to be here. We will stay here for many, many years."
The new site could even lead to more jobs being created in Coventry as Peugeot examines consolidating some of its operations from other centres. "We have capacity to take in more people in the future," Mr Colin said. "There are 34 daughter companies of PSA Peugeot Citroen, most of which are dealerships.
"There are four regional offices. By the time this site is finished, the Coventry office which covers central England will be moved here."
Mr Colin, who has been in the UK since the end of 2005, said his firm would soon bounce back and overcome its troubles.
Europe's second biggest car company suffered an 83 per cent net profits fall last year to #116 million, from just over #678 million in 2005. Mr Colin is among the 100 senior managers who has been asked by new chief executive Christian Streiff to come up with new ways of making the carmaker more competitive.
Mr Colin said: "I am definitely sure that the actions that Mr Streiff is taking will bring profitability back very quickly for the group.
"He's really challenging the company, and is working very much on the product plans, to introduce more new models, more quickly without increasing costs. New models are essential to the development of the company."
Peugeot was already benefiting in the UK from its position, he added, with sales ahead of last year.
"We are at the beginning of a product cycle in the Peugeot brand which is very favourable. We had the 206, whose volumes are being replaced by the 207 and is doing very well. Although the 307 is coming towards the end of its life, it has benefited from the restyling we gave it, and is enjoying exceptional success.
"The bottom point for us was in 2005 when our UK market share was 5.9 per cent, but it recovered to 6.2 per cent last year.
"This year is the start of the same upward trend. We will reach our 6.5 per cent target by the end of this year."
Mr Colin said there had been no backlash of falling sales following the decision to close Ryton. He said: "Most of the people who work here have friends or family who once worked at Ryton, and that plant was part of us.
"Everybody has been very sad, but they understand it was something which could not be avoided. But this new facility here shows we are still committed to Coventry and the Midlands. It is a new chapter for us here."