PSA Peugeot Citroen may have to raise funds through a share sale as it burns through cash in a weak market, sources told the Reuters news agency.

Peugeot has been booking losses of up to EUR200m (US$257m) a month and does not expect a return to profit until 2015. It has said a share sale is not on the agenda.

But sources told Reuters Peugeot's financial situation has deteriorated to the point it would need to raise cash in coming weeks or months and a capital increase or asset sales were possible.

PSA has been hit harder than many European rivals following a plunge in car sales in the region partly because it makes fewer sales in faster-growing emerging and luxury markets. The group is cutting thousands of jobs and closing its Aulnay plant near Paris.

A La Tribune website report which said PSA was considering a new cash call after burning through EUR2.5b (US$3.2bn) in the past year prompted a denial from the company.

A PSA spokesman noted the carmaker had EUR7.3bn (US$9.4bn) in cash reserves and EUR3.2bn (US$4.1bn) in undrawn lines of credit at the end of last year.

The Peugeot family owns 25% of the company and 38% of voting rights. General Motors has a 7% stake in PSA and has said it has no plans to put more cash into the automaker.

In February, GM wrote down US$220m, or about half, of its investment in its French alliance partner. It originally paid US$423m for its stake.

One source told Reuters PSA could also look at selling its 57% stake in parts supplier Faurecia though he added there were not many potential buyers.