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Auto Industry

French carmaker Peugeot Citroen hit by record annual loss

Struggling French automaker PSA Peugeot Citroen has announced it has incurred the biggest annual net loss in its history. It said its huge dependence on the European market has taken its toll.

French carmaker PSA Peugeot Citroen on Wednesday reported a net loss of five billion euros ($6.7 billion) for last year, booking the worst result in its history.

France's biggest auto maker blamed the disappointing figures on a 4.7-billion euro writedown in 2012 and its huge dependence on the European market where it said demand had plummeted in recent months.

PSA's 2012 revenue dropped by 5.2 percent to 55.4 billion euros, leaving analysts wondering just how the company would achieve a turnaround in the medium term.

No short-term solution

France's Socialist government had repeatedly emphasized it would do whatever it took to keep PSA afloat. It already got a helping hand from Paris last year in the form of a seven-billion-euro loan guarantee agreed for Banque PSA.

There had also been rumors that the French state could buy a stake in the carmaker, but the prime minister last week denied such allegations.

PSA would have other fundraising options before resorting to state help again. It could sell its 57.2-percent stake in supplier Faurecia, but executives said such disposals would do little to address the group's underlying structural problems. PSA finance chief Jean-Baptiste de Chatillon confirmed on Wednesday that Faurecia was not up for sale.

hg/ccp   (AFP, dpa)