Renault and PSA/Peugeot-Citroen won’t give up the fight with the European crisis, introducing new products and expanding overseas.
Automakers in Europe struggle for the fifth year with excess capacity, declining sales and sluggish profit. The two automakers face similar problems in Europe, but although Renault has made more progress, PSA’s alliance with GM means lower dividends in the following five years and an expansion in the Chinese market.
From January to June, Renault’s net profit increased 37% to 786 million euro, while Peugeot lost 819 million euro, compared with a profit of 806 million euro last year. But Renault is cautious and aware that Europe’s extended crisis will force the company to remain in turnaround mode for some time.
“The current problems [in Europe] are something that are going to last for a few years,” said Renault Chief Operating Officer Carlos Tavares. “You need to do more with less, or better with less.”
PSA is well known for its ‘splendid isolation’ strategy, maintaining control of a company which eventually started to stagnate. In February the company broke tradition by forming an alliance with GM, which acquired a 7% stake in PSA, to jointly purchase parts and share vehicle platforms.