French carmaker PSA posts sales gain despite Iran withdrawal

Deliveries rose to 2.18 million vehicles, up 38 percent thanks to PSA’s purchase of Opel-Vauxhall from General Motors last year. (Reuters)
Updated 12 July 2018
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French carmaker PSA posts sales gain despite Iran withdrawal

PARIS: France’s PSA Group said its global sales had continued to grow in the first half despite its withdrawal from Iran, a major market for the maker of Peugeot and Citroen cars.
Deliveries rose to 2.18 million vehicles, up 38 percent thanks to PSA’s purchase of Opel-Vauxhall from General Motors last year. Excluding the newly acquired brands, sales rose 1.9 percent globally and 8.4 percent in Europe.
But Middle East sales by the French brands fell 26 percent, the group said, reflecting the deconsolidation of Iran from May 1 under the threat of US sanctions. Iran had accounted for more than 12 percent of group sales last year.
Under a succession of CEOs, PSA has sought for years to expand beyond Europe. But the Iran withdrawal and Opel deal have increased dependence on its home region, which claimed 77 percent global deliveries, up from 66 percent a year earlier.
“We’re not global enough, but at the same time we’re less exposed to the tariff barriers that can spring up here and there,” PSA Europe chief Maxime Picat said on Thursday.
In the current climate of mounting trade tensions, he told reporters on a call that a high domestic sales concentration was “almost becoming a strength.”
PSA sees no reason to modify its full-year outlook for a “stable” European market, Picat added. The group is due to publish first-half financial results on July 24.


EU debates how and when to start trade talks with Trump

Updated 35 min 17 sec ago
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EU debates how and when to start trade talks with Trump

  • The US and Europe ended a stand-off of several months last July
  • The EU is looking now to start negotiations on tariff reductions, possibly including cars

BUCHAREST: European ministers will begin debating on Friday how and when to start trade negotiations with the United States, aware that US President Donald Trump may impose punitive tariffs on EU car imports if the bloc waits too long.
The European Commission has asked the EU’s 28 countries to approve two negotiating mandates so that formal talks can begin. Germany is keen to start as soon as possible, while France is reluctant to engage with Trump.
The United States and Europe ended a stand-off of several months last July, when Trump agreed to hold off on car tariffs while the two sides looked to improve trade ties.
They committed to work toward removing tariffs on “non-auto industrial goods,” discuss ways to agree on product standards to boost trade and increase EU imports of US soybeans and liquefied natural gas.
The EU is looking now to start negotiations on tariff reductions, possibly including cars, as well as a separate set of talks on making it easier for companies to clear their products for sale on both sides of the Atlantic.
The ministers in Romania will face three questions.
The first concerns timing. Germany, whose exports of cars and car parts to the United States are worth more than half of the EU total, is keen to press ahead, but France is hesitant of moving before European Parliament elections in May.
The second question is whether to include fisheries, which is technically an industrial good. Some countries, such as France again, are concerned about increased competition in the sector, which is already strained by Brexit.
The third question is what to do about the previous broader “TTIP” negotiations, which drew thousands to streets in Europe in protest. The Commission has insisted the slimmed-down trade deal it is proposing is not a TTIP relaunch. One option to make that clear could be to formally end TTIP.
Industrial good tariffs are already low, at around 4 percent.
However, the Commission has said that removing them would boost EU exports to the United States by 8 percent and US exports to the European Union by 9 percent by 2033, corresponding to extra exports of respectively €27 billion and €26 billion ($29.5 billion).