The Peugeot 301 hopes to make inroads in new markets. Photo from website.

France going green to cure Peugeot-Citroën malaise

Cars built by certain European brands are sitting about on factory lots as production capacity exceeds demand for automobiles built by Peugeot-Citroën, Volvo and Daimler, with all three showing drops in second quarter sales reports for 2012.

Peugeot-Citroën has just announced a loss for the first half of the year and plans to slash 8,000 jobs and mothball a French plant this month.

This news led the Ministry for Industrial Recovery to announce green technology is the path to brighter days for France's auto industry, according to a Associated Press post by Sarah DiLorenzo and Sylvie Corbet.

The department, created by President François Hollande as part of his re-industrialization plan, believes the solution to the French carmaker woes lie within the development and sale of electric and hybrid vehicles.

It is interesting to note that many of the leading car companies of today are heavily involved in the production of hybrid and electric vehicles, but that is not the source of their overall success in the market.

For example, Audi is making market gains around the globe, without the benefit of significant offerings in the EV or hybrid field. So is this really the answer for Peugeot-Citroën?

The French auto industry has taken a heavy hit – shrinking from 3.5 million vehicles in 2005 to just 2.2 million last year. Industry employment is down to 800,000 – a 30 percent drop in seven years.

"France isn't abandoning its automotive industry," Prime Minister Jean-Marc Ayrault said Wednesday after a Cabinet meeting explaining the plan to government ministers.


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