PSA Peugeot Citroen has posted first quarter Group revenue up 4.6% to EUR13.7bn (US$15.1bn), but is forecasting a 30% plummet in Russia automotive demand this year.
Revenues from new vehicles were up 1.1% due to what PSA maintains is the “positive impact of product mix” as well as price and currency effects – primarily relating to the British pound – offsetting a decline in volumes.
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Pro forma Automotive Division revenues including PSA’s share of Chinese joint ventures rose 3.3% to EUR10.2bn, reflecting the strong increase in revenues from the Asian country.
In the first quarter of 2015, unit sales of assembled vehicles were sharply higher in Asia, Middle East-Africa and India-Pacific, while slightly lower in Europe.
Sales were also down in Latin America and Eurasia, where PSA says rightsizing measures on fixed costs are in progress.
In 2015, PSA expects to see automotive demand increase by 4% in Europe and around 7% in China, but decline by some 10% in Latin America and around 30% in Russia.
The Group aims to generate operating free cash flow of around EUR2bn during the period 2015-2017.
It is also targeting an operating margin of 2% in 2018 for the Automotive Division, with the objective of reaching 5% during the period of the next medium-term plan, covering 2019-2023.
News of the French automaker’s gloomy forecast for Russia comes after PSA and Mitsubishi Motors’ joint venture, PCMA Rus, said it would temporarily halt production of Mitsubishi, Citroen and Peugeot models in the country and cut 100 jobs.
The JV is stopping production of the Peugeot 408 and the Citroen C4 Sedan from 27 April to 10 July, while the SUV production line would be halted between 27 April and 12 May.
Mitsubishi’s Pajero Sport and Outlander are assembled on the line.
Russia’s Transport Ministry says it is looking to use RUB15bn of automotive subsidies in six months this year as Moscow aims to boost vehicle sales by 200,000 in 2015.
