Peugeot is Europe’s second-biggest carmaker but it has reported a loss of 819m euros (£638m) for the first half of the year, as sales fell by 5.1%. It is suffering because of its exposure to countries badly affected by the eurozone crisis in Southern Europe. So Peugeot’s plants are operating at 76% of capacity. As a result it has instigated 1.5bn euros of cost savings. But even with these it said it will not break even until 2014.
The savings are being made by cutting 8,000 jobs and closing one of its two Paris production sites. The closure of the Aulnay factory will save 600m euros, while it will cut another 550m from investment and save a further 350m through a recently-announced alliance with General Motors.
Source: BBC News