The new boss of struggling French carmaker PSA Peugeot Citroen is promising to halt losses and restore profitability to its core manufacturing division by 2018. CCTV’s Kate Parkinson has more from Paris.
After years of strife PSA Peugeot Citroen is back in the race. That was the message from new CEO Carlos Tavares as he unveiled the recovery plan for the troubled carmaker promising to return the company to profitability by 2018 by cutting costs and slashing the product line nearly in half.
French Carmaker PSA Peugeot Tries to Accelerate GrowthThe new boss of struggling French carmaker PSA Peugeot Citroen is promising to halt losses and restore profitability to its core manufacturing division by 2018. CCTV's Kate Parkinson has more from Paris.
With losses mounting almost everywhere else, Peugeot is looking to Asia continuing to accelerate its expansion in China, and hoping to tap into other markets in the region.
“It’s very important for us to be in good shape and in good presence over there to capture all the benefits of this growth. We have said this morning that by 2018, at the latest, we are going to cross the one-million-sales line in China with the three brands we have – Peugeot, Citroen and DS – this is what we intend to do in China so we want to accelerate the profitable growth in that market and because we are in a strategic partnership with Dongfeng, we know that together we can tackle a few opportunities in the Southeast Asian markets,” said Tavares.
China’s Dongfeng Motor Group signed a deal last month to became an equal shareholder in the struggling French carmaker, in exchange for a one-point-one-billion-dollar cash injection.
Peugeot and Dongfeng have long had a joint venture in China, but the new closer arrangement will allow them to use European technology to roll out new models in rapid succession in order to make a bigger impression on the booming Chinese market.
But some analysts are concerned about the two companies different ambitions
Alice Ekman, China Analyst says, “You have common aims on one side which is both for Peugeot, PSA, and for Dongfeng, the willingness to reinforce their position in the Chinese market. But, on the contrary, regarding transfer of technologies maybe the aim is different. Clearly China has more interest, has more expectation in this field regarding technology transfer. There is a plan to launch and create a research and development center in China, a joint research and technology center. So how will this work How will confidence be shared on both sides.”
Peugeot may be determined to get back in the race, but many challenges lie ahead as the company tries to return to profitability and at this stage Peugeot is still a long way from the finishing line.