PSA Peugeot Citroën boss Carlos Tavares will unveil his expansion plans for the firm on 5 April, under the working title of ‘Push to Pass’, having already achieved all of the goals he set when he joined the firm in 2014.
Tavares took the helm shortly after the Peugeot family ceded control of the company, including selling a substantial proportion to the Chinese Dongfeng Group in order to keep the company alive. That year PSA lost around £1.5 billion, although that was an improvement on the £3bn lost in 2012.
Tavares, a keen motorsport fan, put in place a strategy called ‘Back in the Race’, which targeted what PSA needed to achieve to compete with its rivals by 2018. Goals included a streamlined product line-up, expansion in key global markets, cost and efficiency savings in its plants and a clear definition of the Citroën, DS and Peugeot brands. A pick-up truck is expected to be announced shortly, too.
At the time, Tavares said he’d measure success against the firm’s cashflow and operating margins. His targets were smashed last year when PSA posted an operating margin of 5% (against a 2% goal) and profits of £950 million, the firm’s first year in the black since 2010.
Other achievements include increasing productivity in PSA factories to 90% - up from 65% in 2012 - and lowering the firm’s break-even point to 1.6m cars from 2.6m in 2014 due to cost cutting. However, Tavares conceded his goals have been helped by better-than-expected growth in markets around the world, especially in southern Europe, and more favourable exchange rates than anticipated.
On the ‘Push to Pass’ plan (named after the boost button used in some race series to allow cars to overtake each other) Tavares said: “Economic reconstruction is completed.
"We are still working through the details of ‘Push to Pass’, to be sure they are understood. PSA as a group has a lot of potential, some of it that we’ve yet to unleash. This plan is designed to draw that out. In the past, we have been perhaps too modest, but I have absolute belief that we have all the ingredients to achieve more than we do today.”