French carmaker PSA Peugeot Citroen said full-year losses widened but it forecast positive recurring operating income in the first half of 2010 as cost cuts and a sales drive help it combat a "challenging" market.
Along with its fellow automakers, PSA Peugeot Citroen faces the prospect of falling car sales in some European markets this year as the scrapping schemes governments brought in early last year to prop up markets in free fall come to an end.
Chief executive Philippe Varin said in a statement today the group expected market conditions to be challenging in 2010, with the European market down 9 per cent, but that efforts to drive sales, cut costs and improve capacity utilisation as well as new model launches would benefit PSA.
Mr Varin said the group expected positive recurring operating income in the first half of 2010.
PSA posted a recurring operating loss of €689 million for 2009, made up of a recurring operating loss of €826 million in the first half and a much better result of a recurring operating profit of €137 million in the second.
Since he took over the reins at PSA in June last year, Mr Varin has emphasised the group's need to become more global. It is currently in discussions about strengthening its partnership with Mitsubishi Motor.
The group said today it saw the Chinese market -- which overtook the United States last year as the world's largest car market -- maintaining double-digit growth in 2010. It also said the Latin American market should return to growth.
The group posted full-year sales down 10.9 per cent in 2009 at €48.417 billion.
Its full-year net loss widened to €1.161 billion, compared with a net loss of €363 million in 2008.
French car parts maker Faurecia, in which PSA owns a majority stake, yesterday posted full-year results showing a 22 per cent fall in sales but a narrowing loss and said it hoped for a return to profit it 2010.
PSA Peugeot Citroen's smaller French rival Renault is due to post its full-year results tomorrow.
Reuters