Last year, PSA Peugeot Citroen was bailed out by a 3 million euro investment drive that brought China’s Dongfeng and the French government among controlling parties, and also the naming of Carlos Tavares as chief executive officer.
Last year, on March 31, the former second in command at Renault became the chief executive officer of PSA Peugeot Citroen, the second largest European automaker. His task – par years of losses and drive sales and profit up at an automaker that was highly dependant on the (then) slumping European continent. His strategy: just like he did when he was Renault’s chief operating officer (2011-2013) he resolved to immediate measures designed to address the company’s critical issues – and the positive effect of the steps was crystal when the 2014 financial results showed PSA managed to stop bleeding money. After three years of losses (1.04 billion euro in 2013), the automobile unit recorded a 63 million euro operating profit and overall group operating income reached 905 million euros after losing 364 million euros a year before. The automaker’s net loss shrunk from 2.23 billion euros in 2013 to 555 million euros.
Additionally, Tavares was mostly impressed by the carmaker’s operating free cash flow figure, which turned from a 426 million euros burn in 2013 to 2.18 billion euros last year – excluding both one-time gains and charges. Analysts were more impressed by the fact that his leadership inspired the company to search for profitability instead of sales volume. His only problem might be the management of the three-way control – after the bailout the Peugeot founding family’s stake dropped to 14 percent, matching Dongfeng and the French state.
Via Automotive News Europe