PSA Peugeot Citroen to fall short of sales target in China

SHANGHAI, (AFP) - PSA Peugeot Citroen China's unit is expected to miss its full-year car sales target due to intense competition and slumping sales.
Citroen's venture with Dongfeng Motor Corp, one of the country's biggest automakers, sold 46,700 cares in the first half of the year, down from 52,200 a year earlier, and sales were expected to fall further, Citroen managing director Claude Satinet was quoted as saying by the China Daily.
The company had been forecasting a 20 percent increase in annual sales to 124,000, compared with a growth rate of 24 percent in 2003 and 60 percent in 2002.
The downturn in sales comes as the company prepares to launch its C5 and C4 models in China next year to stimulate demand, the newspaper said.
The C5 will arrive as the country lifts quotas on car imports in line with its commitments to the World Trade Organization.
Consumer demand for autos has been dampened this year by the government's clampdown on lending to the sector, compounded by fierce competition as many consumers delay purchases in anticipation of lower prices.
Passenger car output in the first nine months of 2004 was up 22 percent year-on-year to 1.8 million, compared with 26.23 percent in the first eight months.
Passenger car sales also rose 13.94 percent month-on-month to 194,100 units in September after slumping to 170,300 units in August.
It was the first monthly increase since April, when the government tightened lending in the auto sector.