PSA Peugeot Citroen seems to have shaken off the last shackles of its recession worries and is striking ahead with an ambitious plan dubbed 'Push To Pass.' Given the racing overtones of the plan's name, many will be disappointed that there's no mention of a revived Le Mans 24hrs racing programme involved, but PSA's boss, Carlos Tavares, has promised that between now and 2021 his two vehicle brands (three if you count Citroen's luxury DS spinoff) will launch 26 new passenger cars and eight new commercial vehicles including a pickup truck for the burgeoning one-tonne market.
It was only a short time ago that PSA, so badly rocked by falling sales during the recession, had had to seek a bailout which came in the form of a joint investment in the company by both the French government and the Chinese car maker Dongfeng. Now though, the mood is bullish and PSA is planning to make its first dividend payment to investors since 2011. It's expected that the payout will be equivalent to 25 per cent of its total profits.
That alone should be an indication of how much healthier PSA has become in the past three years since its nadir. “Based on our financial reconstruction, we will launch a global product and technology offensive. Now more agile, we are ready to shift paradigms by anticipating changes in car usage patterns. Our digital transformation will make the PSA Group a company connected to its customers. With “Push to Pass”, we will ensure PSA profitable organic growth” said Tavares.
The new vehicle lineup will include seven plugin hybrids and four pure-electric vehicles, as well as advances into the autonomous driving arena - an area from which PSA has been notably absent so far. Tavares is targeting a two per cent operating profit margin by 2018, rising to six per cent by 2021 - behind the eight per cent target of rivals Renault, but still significantly better than the current slim two per cent margin. He also wants company revenue to grow by ten per cent by 2018, rising to 15 per cent by 2021.
It won't be easy though. Analysts are suggesting that PSA's relatively small size (even though it's the second biggest European car maker after VW) means that it may struggle to develop cutting edge tech such as new-generation batteries and electric motors and may need to seek further tie-ups with other car makers. PSA currently shares technology and engines with BMW and Mitsubishi.
The group also faces the challenge of getting its DS luxury brand to a point of competitiveness with other major European premium car makers. The current DS 3 small hatch is generally well liked but the DS 4 and DS 5 have both come in for a welter of criticism and making DS a viable entity could suck up a lot of time, effort and cash.
Here in Ireland, it's currently a mixed bag for PSA. Peugeot and Citroen-DS are run by separate importers here. Peugeot is managed by privately-owned Gallic Distributors while Citroen, until recently an offshoot of the Citroen UK operation, is now under the control of the IM Group, which is also responsible for Subaru. Peugeot is thus far having a sold 2016 - its sales were up by 29 per cent in the first three months of the year, about in line with the rest of the market. Citroen is not doing so well though - in spite of strong critical receptions for such models as the C4 Cactus and C4 Picassso, it has seen sales fall by ten per cent - the only brand to suffer an overall drop in sales.
