The factory was originally constructed by the Rootes Group in 1940 to build aircraft engines during the Second World War. After the war it became the headquarters of the Rootes Group, but when the organisation entered financial difficulties in the 1960s the company (in stages) and thus the plant were taken over by American car-making giant Chrysler. Chrysler itself entered financial difficulties and sold the plant for a symbolic US$1.00 to PSA Peugeot Citroën in 1978.
Peugeot started building their 309 model there on 28 October 1985, and by the end of 1987 it had been joined by the 405. When 309 production ceased in early 1993, the 306 took its place and for a while was the mainstay of production after the 405's demise in the autumn of 1995. The second production line was revived over the summer of 1998 with the commencement of 206 production, and the 206 was the only car produced at the plant after the end of 306 production in the spring of 2001.
In April 2006, Peugeot decided that the Ryton plant would close during 2007. In the event, it closed on 12 December 2006 and the 140-acre (0.57 km2) site was sold to developer Trenport Investments Ltd for industrial use in March 2007. Demolition of the plant began on 12 November 2007.