Peugeot Repair Questions? Ask a Mechanic for Answers ASAP
before just replacing the engine I'd get a compression test done as this will show if the engine is in good health or not- all the cylinders need to be within 10-15 psi of each other
do you have any fault codes that have been pulled off the ECU, if so can you tell me what they are?
also what engine is this? Is it the 1.6 HDi?
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OK so if its mechanical then yes a compression test is a good next step and also can also show if the cam timing has slipped
I also have to say it may be worth finding another garage if you can, as you seem to be getting conflicting reports and they seem a bit keen to offer big cost solutions
do you need anything further?