Peugeot Lowers Annual Sales Profit Target of Automotive Business

According to Reuters, given the price pressure in the European automotive market, the French Peugeot Citroen lowered its annual sales profit target for the automotive business and stated that it plans to cut the cost of 800 million euros (1.1 billion US dollars) next year.

Peugeot revealed that in the third quarter of this year, sales of the automotive business segment fell 1.6% year-on-year to 9.31 billion euros (US$13 billion). Peugeot predicts that the increase in the cost of raw materials will reduce Peugeot’s profits by 700 million euros (US$970 million). The earthquake in Japan caused Peugeot to lose 250 million euros (350 million US dollars). Peugeot had hoped that the auto business could achieve profitability this year, but currently Peugeot expressed its expectation that the business can achieve balance.

Sustained supply of parts and components caused Peugeot Motor Corp to reduce production by 45,000 vehicles in September. Global production in the third quarter fell by 6.8% year-on-year, and new vehicle sales fell by 3% year-on-year.

Peugeot said that pressure on prices has exacerbated market competition. Coupled with the declining demand in southern Europe, its performance in September has been less than satisfactory. In order to cope with the more severe market environment in Europe, Peugeot will discuss with the company's employees about fixed reductions next year. The problem of cost.