PSA Peugeot Citroën said it was not planning to reduce its stake in Faurecia, its parts-making division, after recent comments by the French government that the struggling carmaker needed to “go further” in its restructuring programme.
Frédéric Saint-Geours, Peugeot’s executive vice-president of brands, said yesterday that the group, whose financing arm received a €7 billion state rescue package in October, was ploughing ahead with cost-cutting plans aimed at redressing plunging sales in Europe, which would be boosted by new launches this year, including more upmarket models.
He spoke as the group announced a 16.5 per cent drop in the sale of new vehicles and assembly kits last year.
The effects of the European economic crisis led to a fall of 13 per cent in France, 15 per cent in Spain, 21 per cent in Italy and 40 per cent in Portugal. The four countries account for almost 56 per cent of Peugeot’s European sales.
US-led sanctions against Iran also forced the carmaker to suspend assembly kit sales to the country, which accounted for 13 per cent of sales in 2011.
Mr Saint-Geours told journalists that Peugeot’s restructuring – which includes cutting 8,000 jobs, closing a French plant and shedding non-core assets – “should be in line with the kind of things the European Union asks for”, in light of the state guarantee the company’s financing arm has received.
It emerged yesterday that the French government had notified the EU antitrust authorities of its €7 billion intervention last October to secure the financing of Banque PSA Finance, which is crucial for funding Peugeot and Citroën dealers and car loans.
Paris had earlier refused to acknowledge that the bailout amounted to state aid, arguing that since it applied to the financing arm it did not amount to full industrial support. – (Copyright the Financial Times Limited 2013)
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