France Budget Minister Jerome Cahuzac said that the state is considering taking a stake in PSA Peugeot Citroen.
Today, February 8th, PSA Peugeot Citroen reported a 4.1 billion-euro writedown, which prompted the French state to consider taking a stake in the struggling automaker. Budget Minister Jerome Cahuzac said in an interview that the government will do whatever it can to save the company.
“It’s possible…This company must not and cannot disappear and we must do what it takes for this company to survive,” said Jerome Cahuzac.
Peugeot, one of the companies which were hit hard by the economic crisis in Europe, plans to close a plant near Paris and cut 8,000 jobs to cut loses which approach 200 million euro per month. the automaker said that its target is to breakeven by 2014 and that the writedown did not change its plan to cut by half expenses by the end of this year or the previous 3 billion-euro net-debt forecast for the end of last year.
“The (writedown) measure will not hit cash flows, nor will it affect liquidity or solvency,” a Paris-based trader said. “It does however show that the outlook for a recovery in the European market is more pessimistic than it was six months ago.”