French Manufacturers Raise Sales In First Half

Renault and Peugeot-Citroen improved sales in the first half of 2010, and look like reporting improved bottom lines for the whole year after reporting huge combined losses of €4.2 billion in 2009.

Peugeot sold a record 1.86 million vehicles in the first half of 2010, up 16.9 per cent on the same period last year, boosted by new cars like the Citroen C3, C3 Picasso, Peugeot 3008 and 5008 MPVs.

According to IHS Global Insight, improved sales were boosted by the last throes of the European scrapping schemes, while demand in Latin America and China continued to grow.

Peugeot-Citroen has been criticised for being too Eurocentric.

IHS Global Insight had some reservations about the rest of 2010.

“There are still some questions as to how PSA will fare in Europe during the rest of 2010 in this post-incentive climate, despite the continued introduction of new and replacement models,” IHS Global Insight analyst Ian Fletcher said.

Deutsche Bank analyst Gaetan Toulemonde said Peugeot-Citroen’s operating income should be in the black in the first half by about €300 million, a €1.2 billion improvement on the same period of 2009.

No word on the second half.

In all of 2009, Peugeot-Citroen’s net loss increased to €1.2 billion from €363 million the previous year. Some analysts expect an improvement in 2010 with earnings close to €1 billion.

Renault improved its sales by 21.6 per cent in the first half to 1.3 million cars and light commercial vehicles, including Dacias and Samsungs.

Very weak
“The performance has been equally spread between Europe and outside where it’s worth mentioning the strong growth in Brazil – up 27 per cent – and in Korea – up 60 per cent. This positive volume and mix effects should allow improving significantly the half one result. We expect the group to release an operating profit margin of €500 million in the first half, or a €1.1 billion improvement on last year. For the second half, despite a very weak European market, volumes should be only three per cent lower than last year,” said Deutsche Bank’s Toulemonde.

No word on second half profit.

Renault lost €3 billion in 2009, compared with a profit of €600 million the previous year.