JAPAN: PSA head sees no recovery signs for France - report
The head of PSA Peugeot Citroen said on Wednesday the European car market was set for a rebound in the fourth quarter of 2003 and beyond, but he saw no sign of a recovery in the company's key home market of France, Reuters reported.
On Monday, PSA issued a profit warning for the second time in three months and posted a dip in quarterly turnover as it battles a rocky car market and the impact of a strong euro, the report noted.
"The fourth quarter should be better. I think we hit the bottom during the first half of this year," chairman Jean-Martin Folz told Reuters in an interview at the Tokyo Motor Show.
Asked about the outlook for 2004, Folz reportedly said: "I believe the European market is no longer decreasing, so we will probably see some kind of upturn there."
Reuters noted that PSA this week cut its full-year operating margin target for its core car-making unit to around 3% from the 3.7% or more previously forecast.
In 2002, PSA's operating margin was 5%, and Folz said that three quarters of the fall in operating margin this year was due to a rise in the value of the euro, the report added.
PSA said on Monday the strong euro would take at least a €600 million ($US700 million) bite out of group core profits this year, Reuters said, adding that former sector star PSA is also struggling with a slide in demand for cars in western Europe, particularly in France.
Asked when demand would recover in France, Folz told Reuters: "I don't know. I see no sign yet."
The news agency noted that Folz has carved out a reputation for PSA as Europe's most reliable mass car maker and the profit warning in July was the first since he took the helm in 1998.