By on February 15, 2012

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.

 

 

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16 Comments on “PSA In The Reds...”


  • avatar
    Jacob

    This would explain why they pulled out of LeMans racing.

  • avatar
    Dr.Nick

    Given the current financial situation the Europeans have gotten into, the long expected cull of the Euro manufacturers is likely to occur. Fiat has Chrysler to throw them a lifeline now, and Renault has Nissan.

    PSA and Opel are squarely in the crosshairs of destiny.

    • 0 avatar
      MrWhopee

      Indeed their markets are very concentrated in Europe, they don’t have much presence anywhere else. With the Europe in downturn, car sales are bound to decrease, and they’re bound to be disproportionally impacted by it. At least Fiat now has Chrysler to save their bacon, and Renault has Nissan, it also has more presence in emerging markets like South America and Eastern Europe. Opel? At least their designs are used as bases for various GM cars sold elsewhere.

  • avatar
    TonyJZX

    I think Fiat are lucky to have Chrysler to ‘bail’ them out so to speak.

    Don’t worry about Nissan/Renault… Carlos has things well in hand with Nissan making major bank having been spared by the tsunami and flood gods and Renault has Dacia and Russia to help them out.

    PSA though… what do they have? they’re largely sunk I would say…

  • avatar
    photog02

    Great. If this happens we will be hearing Sergio talk about 50,000 Peugot 107 sales in the US by the next two years, with the message set to repeat every year.

  • avatar
    Pete Kohalmi

    I don’t know all that much about Peugeot and Citroen. Is their biggest market France? I think they’re all over Europe and even South America, Asia, and Africa no? I’d like to see them here in the states. It would spice things up here.

    I’ve heard those old Peugeots are cheap but very durable. Anyone know?

    • 0 avatar
      charly

      They are unlikely to enter the American market as their biggest market is Iran

    • 0 avatar
      Dr.Nick

      Not sure I’ve heard an old Peugeot referred to as reliable, but there’s plenty still around in Africa. Since PSA make mainly hatchbacks, and Americans plain don’t like hatchbacks, I don’t think there’s much of a chance they’ll ever come back here.

  • avatar
    Chipper Carb

    I would love to see a new Citroen sitting in my driveway, bring on a Fiat merger!

  • avatar
    gslippy

    Is there a car in that picture?

  • avatar

    They are not known for durability – typical South European car. I know we avoided used ones as a plague. Nothing like Volvo, Ford, Opel or VW or even SAAB (RIP). But they are not as weird as Renaults and 405 used to handle well. I saw lot of them in Israel so assume they sell in ME. Why prefer Peugeot over FORD/Opel/VW/Volvo/Audi – have no idea. But I can understand that people may like them better than Korean or Japanese car.

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