PSA Group posts record profits despite sales slide

The success of SUVs such as the Citroën C5 Aircross helped the PSA Group to record profits

Expansion of SUV range and cost-saving boosted French car giant in 2019

The PSA Group achieved record profitability in 2019, despite its new car sales falling by more than 10%.

The group, which comprises Citroën, DS, Peugeot and Opel/Vauxhall, posted revenue of €74.7 billion (£61.8bn) for 2019, up 1% year-on-year, with profit of €3.2bn (£2.65bn), up 13.2% from 2018.

This came despite new vehicle sales falling 10.3% year-on-year to 3,479,096.

PSA said the rise in profit was due to cost savings from the further integration of Opel/Vauxhall into the group and from efforts to reduce the complexity of its product lines, trimming production spending. It also cited increasing sales of higher-margin models, such as SUVs.

The PSA Group is in the process of merging with Fiat Chrysler Automobiles (FCA), creating the world’s fourth-largest car maker. The merger is ongoing, with both sides expecting it to be finalised either late this year or early in 2021.

In Europe, the five PSA brands sold a total of 3,019,729 new vehicles, a 2.8% decline on 2018. The firm particularly struggled in China, where sales slumped by 55.4% to 117,084, and recorded substantial declines in the Middle East and Africa (-43.7%) and South America (-22.5%).

Peugeot continued to be the PSA Group’s most successful brand, taking 1,453,823 sales, although this was down 16.5% year-on-year. Citroën sales were down 5.4% to 989,853 units, although the brand did post a 0.8% increase in Europe. Vauxhall/Opel sales fell 6.2% to 973,431, while DS sales increased 16.4% to 61,989. 

As with other firms, the PSA Group has invested heavily in the electrification of its line-up and says it is on course to avoid paying any fines for not meeting the European Union’s 95g/km average fleet CO2 target that will come into force this year.

PSA chief executive Carlos Tavares said: “We're ready for the energy transition, and all teams are focused to offer a clean, safe and affordable mobility for customers. Based on our business model and fighting spirit, which has proved to be efficient, we are eager to enter a new era with the projected merger with FCA.”

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