As Europe's economy continues to suffer, so do automakers. One of the latest pieces of bad news comes from French carmaker Peugeot which says it will write down its assets by $5.53 billion. The figure represents almost 29-percent of the company's property, valued at $19.4 billion in June. Peugeot says it will also take a second-half charge of $325 million for "onerous contracts." Speaking of onerous, The Detroit News notes the "write-downs are more than double Peugeot's current market value." Yipes.

"This calculus results from cautious assumptions about the European economic environment," Chief Financial Officer Jean-Baptiste de Chatillon is quoted as saying in the article. "We think that this European car market will remain affected by the crisis for a long time."

With European auto sales falling the most in almost 20 years, Peugeot executives see little chance of improvement. Peugeot's sales dropped 13 percent in 2012 and Chatillon said markets could fall another 5 percent this year.

Efforts to right the ship include cutting 17 percent of its French workforce, closing a factory near Paris and selling off assets. The French government has offered $9.3 billion in bond guarantees that await European Union review. In addition, an alliance between General Motors and Peugeot authored last year was meant to save the two companies $2 billion in annual cost savings and sales improvements over 5 years, but it's currently under review.


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    • 1 Second Ago
  • 24 Comments
      ELG
      • 1 Year Ago
      well its about time they wrote it down. how else are they going to keep track of all that money? All in your head?
      Fun Bus
      • 1 Year Ago
      stop making **** boring cars, just an idea.
        • 1 Year Ago
        @Fun Bus
        [blocked]
        thequebecerinfrance
        • 1 Year Ago
        @Fun Bus
        Right. Peugeot are actually pretty good drives. Much better than the average american cars. They, like other european manufacturers, are building too many cars in a failing economy. And that's too bad because I miss the diversity they have. I find the average american car (not the Mustangs and else which are not your average car) in america to be bland. A peugeot 508 actually looks fantastic in and out.
      Avinash Machado
      • 1 Year Ago
      Time for intervention by the French government.
      Jagadesh Kulanthaive
      Tata (jaguar & rover) will be there guys.. !! dont worry
      RGT881
      • 1 Year Ago
      It's not just Peugeot that's taking on water, but it's all of France and their silly communist regime. Everything about France is just a pig with lipstick.
        thequebecerinfrance
        • 1 Year Ago
        @RGT881
        Lol, communist? There goes goes the american education system. And you're, how stupid are these French anyway? Good health for the others than the rich? No guns available easily? A pension for every worker? Wow, that country really sucks...
          thequebecerinfrance
          • 1 Year Ago
          @thequebecerinfrance
          PLease add a stupid edit button! Every one has one, why can't you?
      Jimmy
      • 1 Year Ago
      Even socialism can\'t save Peugeot1
      ferps
      • 1 Year Ago
      Which Chinese firm will end up buying Peugeot?
      ima_demorat
      • 1 Year Ago
      Hey Peugeot, call Emperor Obama. He's always throwing (our) money at lost causes. He'll throw a few billion your way!
        • 1 Year Ago
        @ima_demorat
        [blocked]
      to your email L
      • 1 Year Ago
      Jeez folks it's not the gov't of France that's the problem it's the economy stupid. In addition Europe is a pretty much mature market, most of their expansion will be in E. Europe, Russia India China, S. America and this is true of any mfr. But of course that folks that 'whine' about France's 'socialism' aren't as Hillary sez part of the 'evidence based world' so not surprising.
        RGT881
        • 1 Year Ago
        @to your email L
        Governments are ALWAYS the underlying cause behind a poor economy...NO exception.
          aatbloke1967
          • 1 Year Ago
          @RGT881
          RGT, that's simply not true. They can certainly cause or enhance a poor economy by their policies, but its more common for a modern manufacturing economy downturn to be caused by external forces, especially larger economy of another country.
      bootsnchaps60
      • 1 Year Ago
      Maybe it's time for a European version of American Motors. Combine all the weak players together.
        Pdexter
        • 1 Year Ago
        @bootsnchaps60
        Meaning all the French automakers? :D The economy going down in southern Europe just highlights these car manufacturers problems, especially as North Europe has never been biggest fan of Peugeot and Citroen. Hope the best for them, but the southern Europe is in need of a shock for big changes and this will do just that.
          to your email L
          • 1 Year Ago
          @Pdexter
          Actually aren't Peugeot and Citroen somewhat merged and Renault isn't it part of NIssan?
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