Peugeot is working on a petrol-electric hybrid system that will be aimed at the Chinese market, but will also be offered in Europe.
The shift away from the current diesel hybrid system reflects the lack of interest for diesel engines in the lucrative Chinese car market.
Peugeot has no plans to use its current diesel hybrid system in any new models, other than the 508 saloon, but the RCZ hybrid concept car is likely to go into production in the near future, and could be a willing recipient.
Peugeot also says that the current hybrid system is compatible with the 1.6-litre diesel engine but it has yet to decide if cost would cut demand below a viable level.
Peugeot has not revealed when the petrol-electric hybrid system is likely to come to market.