Car manufacturers continue to struggle in Europe

The European crisis has continued to hurt car makers from all over the globe with PSA Peugeot Citroen finding itself forced to devalue its assets by about £3.3bn and Nissan revealing that their sales have been tumbling downwards. BMW managed to avoid the downward spiral however as they sold a record number of vehicles over the first month of the year.

Nissan reported that their third quarter sales fell by about 35% when compared to the previous year which it said was a result of the poor demand in the US, Europe, and China. Overall, during the third quarter European sales dropped by about 16% due to a lack of demand.

In addition, Japanese car makers in general have faced a tough market in China due to a territorial issue that led to anti-Japanese boycotts and riots during last year. Chief Executive for Nissan, Carlos Ghosn, stated that the company’s performance was not up to par with management expectations which are largely the result of the hard operating conditions that were present in Europe.

IN the meantime, Peugeot is also looking at a report that may result in the company being owned by the state after being forced to take a 3.9 euro write-down this past week. When asked whether the country of France might support the car maker, Jerome Cahuzac the budget minister stated that it is possible since the company cannot disappear and the government will do what it can to support it.

However, a Reuters article quoted a different source from the French government that stated that investment in Peugeot is not something that is on the agenda. The source added that the company needs to instead focus on rebuilding based on its original agreement with General Motors.