I believe most 206B delivered recently has this problem. The rust you see is due to the hub assembly being made from cast iron which rust easily. Its such a shame that NAZA/Peugeot did nothing to coat this part properly prevent this from happening during assembly.
I did plan to go to BB Glemarie to ask them to fix this for me, but just the though of going all the way there, then to haggle/argue with them over this problem, dah make me tired. So I decided to DIY as usual.
First, jack the car up, secure it on jack stands and remove the tyre. It would most probably be very difficult for the tyre to come off because of the rust. Use your hands/mallet and hit the tyre as hard as you can, the top then the bottom, the left and right until it loosens up. You know, i only managed to remove my left hand side tyre. for the right hand side tyre, I had to go to a tyre shop and ask them to remove the tyre. They too had a hard time removing the tyre. Then I applied grease to affected area of the rim and fix the tire back. Went back home and continued my DIY project.
Next wash off the rust using a wire brush or steel wool and leave it to dry.
Once it has dried, apply some rust converter. I used this which is available at most hardware shops. After the rust converter has worked its magic, paint over the affected area with anti-rust paint.
When the paint is dry, re fit your tyre and pat yourself for a job well done :-)
