Peugeot Citroen Has Record Half Year on China Demand

Strong demand for new cars in China helped French auto maker PSA Peugeot Citroen SA report Wednesday a record number of unit sales in the first half of the year.

In a statement, the maker of the popular Peugeot 207 and Citroen C4 Picasso said that sales of cars and light trucks rose 17 percent to 1.86 million units in the first six months of the year, compared to 1.59 million a year earlier.

Jean-Marc Gales, the executive brought in from Mercedes-Benz to oversee brand image revamps at both Peugeot and Citroen, said that the period was the carmaker’s “best half-year ever” in terms of unit sales.

In Europe, where government scrappage schemes have been or are being phased out, Peugeot Citroen said that new car registrations rose by 7.7 percent to 1.21 million units, outpacing the overall market growth of 1.1 percent.

The French car maker is looking outside Europe for growth, where sales accounted for a growing percentage of its total — 36 percent in the first half, compared with 34 percent in 2009.

Latin American unit sales rose 13 percent in the period to 127,000 units.

But the strongest growth was in China, where sales gained 49 percent to 176,000 units.

Looking forward, Peugeot Citroen said it expects the European car market to contract by around 9 percent over the year, although it expects to keep making market share gains.

The French car maker forecast more than 10 percent growth in the Chinese market, and less than 10 percent in Latin America.

Peugeot Citroen is introducing a host of new models such as the Peugeot 3008 and the Citroen C5 as part of its three-year plan to boost earnings by euro3.3 billion ($4.95 billion) through cost cuts and higher sales.

By adapting its offering to meet the demands of environmentally conscious urban dwellers, older customers and Asian drivers, Peugeot Citroen hopes to gain market share and close the profitability gap with its competitors.

EMMA VANDORE, AP Business Writer PARIS