Paris: French auto giant PSA Peugeot Citroen warned on Tuesday that it faced an operating loss of between €1-2 billion ($1.4-2.8 billion) in 2009 and was raising €500 million in fresh cash.
PSA said that it expected the loss “given the current situation in the market and uncertainties (and) ... prudent management of the finances.”
The auto group warned in April that it expected a loss this year but had not provided a figure. For 2008, the company sustained a net loss of €343 million.
At the same time, the company said that it now expected 2009 sales to be down 12%, less than the 20% fall estimated earlier, but would likely have to cut back output in the fourth quarter in anticipation that the government would end its trade-in support scheme for new cars in 2010.
PSA shares were down more than 3.5% in early trading on an overall weaker Paris stock market.
The company also announced that it would issue convertible bonds due in 2016 to raise €500 million to fund future projects and strengthen its financial position.