French carmaker PSA Group’s vehicle sales fell 12.8% in the first half as emerging markets weighed on its overseas business, challenging the trajectory of the Peugeot manufacturer’s recovery.
Sales fell to 1.9 million light vehicles in January-June, the company said on Monday, from 2.18 million a year earlier.
PSA, which has notched up successive sales and profit records under Chief Executive Carlos Tavares, is due to report full earnings for the period on July 24.
In Europe, its biggest market by far, PSA eked out a 0.3% gain in sales that lifted its share of an automotive market down 2.5% overall. The Opel-Vauxhall business acquired from General Motors in 2017 also gained ground in the region.
“Despite the decline of the global automotive markets for this first half, our commercial teams have managed to increase market shares in several countries,” Tavares said in the company statement.
PSA recorded sharp declines almost everywhere else, however, with deliveries down a further 60.6% in China, where the group has suffered a protracted sales collapse at its joint ventures with local manufacturers Dongfeng and Changan.
Sales volumes were also down 29.3% in a contracting South American market and 68.4% in the Middle East-Africa region – punished by the group’s forced withdrawal from Iran under threat of U.S. sanctions.
After posting a 7.7% operating margin for 2018, PSA’s 4.5% group profitability goal for 2019-21 still looks conservative, with many investors expecting more.
The carmaker’s shares were up 1.2% at 22.29 euros by 0714 GMT.