How do you remove the factory radio on a Peugeot 106?

On an M reg 106 1.5D it is surprisingly easy. The odd shaped Peugeot radio fits in a standard radio slot. To be honest the easiest thing to do it take it to a Peugeot dealer and ask them nicely to remove it - it will take them thirty seconds using the special tool. Alternatively the Haynes manual tells you how to make up a pair of tools to do the job. A long flat key is slid down each side of the radio and hooks behind the retaining lugs. Get them in place properly and the radio "just" slides out. Replacement radio just slots in, though you will need a conversion kit for the electrics, or to do some soldering.

with two screwdrivers and a knife just anchor a screwdriver in either side and then un clip the latches with the knife

For the majority of the standard stereos two 'flat keys' are required if you head to you nearest halfords/motor store they're bound to have some and theres a good chance you can just borrow them to rip out the stereo...I don't know how easy they are on different models but my 2000 Zest 2 was virtually welded in lol so may have to involve a screwdriver to get some leverage.

On my 206 (petrol c 2003) the following worked. Insert a pair of small screwdrivers about 3cm in the two holes on the right (until you feel them contact the spring catches) & a thin flat blade between the radio and the trim. Press the screwdrivers outwards to release the catches and gentle east the right hand end of the radio out a cm or so with the help of the blade. Then repeat at the left end. Repeat once more at each end if you need to & then radio should slide out.