French carmaker PSA Peugeot Citroën is feeling the burden of the economic crisis as the company said on Wednesday that despite group revenues being up 3.5% compared with third-quarter 2010, its core automotive division’s revenues are down 1.6% year-on-year and as a result, it would barely break even this year.
The Paris-based automaker blamed the drop in revenues on the negative impact from the aftermath of Japan’s tsunami (€250 million) and the higher prices of raw materials (€700 million).
PSA’s management said it would try to restore the automotive division’s competitiveness and profitability by implementing an €800 million (US$1.13 billion) cost-savings plan in 2012, which will reduce purchasing costs by €400 million and fixed costs by another €400 million.
According to a statement issued by the company, these measures could result in the loss of an estimated 3,500 jobs in Europe in 2012, including 1,000 positions in manufacturing and 2,500 positions elsewhere.
