More bad news from PSA – production of the brand-new Peugeot 208 subcompact will be cut by one third, as PSA grapples with an imploding market for small cars in Europe.
According to Automotive News Europe, the 208 came in third place in the August sales rankings for Europe, behind the Volkswagen Golf and Polo, but even that wasn’t enough to help the small Peugeot succeed.
The 208 competes with the Volkswagen Polo, rather than low-cost cars like the Dacia Sandero, leaving it in a tough spot. The 208 is also built in France (though some units are built in Slovakia), leaving PSA exposed to uncompetitive labor costs and underutilized plants. While Volkswagen isn’t a low cost brand, they have massive economies of scale that PSA can’t take advantage of, and can weather the storm better.