• Tuesday, March 05, 2024
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BusinessDay

Peugeot steps up talks with China as sales continue to slide

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Ailing French car maker PSA Peugeot Citroen unveiled another batch of bad sales figures on Monday.

This was amid reports that the company is close to inking a deal with China’s Dongfeng Motor and the French state on a capital injection.

PSA’s global sales tumbled for a third consecutive year in 2013, falling 4.9 per cent to 2.8 million vehicles.

Sales in the dwindling European car market were down 7.3 per cent to 1.6 million vehicles.

Sales in China by contrast surged by 26 per cent to 557,000 units, making the Asian powerhouse PSA  the second-largest market after France.

PSA, which is closing an assembly plant in Paris this year after net losses of 6.7 billion dollars in 2012, said the results showed its globalisation strategy was starting to pay off.

“With markets outside Europe accounting for 42 per cent of total sales in 2013, the group is on track to meet its target of generating 50 per cent of sales in these markets by 2015,’’ the company said.

The figures came a day after PSA’s supervisory board met to discuss a deal which would see China’s state-owned Dongfeng Motor and the French state pump money into the car maker in return for a stake in the company.

Les Echos business daily reported that the board endorsed the broad outlines of the plan which has been valued at around four billion dollars and which would reduce the Peugeot family’s share of the business.

PSA has refused to comment on the negotiations which are expected to be concluded by the announcement of its 2013 results on Feb. 19.