PARIS: November 03, 2016. The Peugeot Citroen Groupe (PSA) has awarded GEFCO, owned by Russian Railways, a five-year, €8 billion contract to manage and optimize the automaker's global manufacturing supply chain from January 2017.

Under the agreement, GEFCO will design and implement global logistics and transport solutions for the three PSA Group brands, Peugeot, Citroën and DS. The company will manage and optimize the group's entire supply chain, from sourcing components for production and assembly plants to distributing finished vehicles, in addition to distributing spare parts.

As a 4PL provider, GEFCO will be PSA's sole partner in coordinating with suppliers to optimize multi-modal processes that combine rail, road, sea, air and inland water transport to create end-to-end solutions in 50 countries including the Russian Federation.

"The agreement will be a powerful driver of improved operating performance at the PSA Group," said Yannick Bézard, PSA's EVP Purchasing. "We have every confidence in GEFCO's ability to partner us as we navigate a challenging transformation, pursue new business opportunities and develop internationally," he added.

Russian Railways acquired 75 percent of GEFCO from PSA for €800 million in 2012. The manufacturer retains a 25 percent stake.

In June this year GEFCO signed a three-year agreement with the Russian Export Center in support of the country's manufacturing sector.

PSA chairman Luc Nadal commented at the time: "I personally see this agreement as a strategic partnership that can significantly help Russian companies to face worldwide competition and get sustainable positions in the global economy."