PSA In The Reds
Europe’s second-largest automotive group PSA Peugeot Citroen is looking at red ink. PSA’s automotive operating loss excluding one-time items was 92 million euros ($121 million), after a 621 million profit the previous year, Reuters says.
PSA racked-up a 497 million-euro loss in the second half of 2011, after a 405 million profit posted in the first six months of the year. This does not bode well for 2012 which looks like a tough year for European automakers. PSA raised its saving target and considers sales of assets in a battle against rising debt.
The red ink should fuel speculations about a tie-up with Fiat, which had been rumored ever since Sergio Marchionne said that “he would be willing, in principle, to be part of a consolidation that would create another car company in Europe rivaling Volkswagen AG in size.”
Rival Volkswagen in the meantime is expected to exceed the record profits of 2010 when it presents the 2011 balance sheet on March 10.