Moody’s, the now famous (for bad things) credit rating agency, has returned to appear to poke a stick. This time the company is PSA has received the smack. PSA was not in a good situation, with a grade three degrees below the point of “recommended investment”. Come on, that Moody’s said even before this news that PSA was a bad investment, but it is now still has downgraded one point, leaving four degrees below the point of “investment”.
Agency says that unless dramatic recovery European car market in 2014, which in view of the figures of 2013 does not look to happen, PSA will have to resort to further cuts and restructuring to further lower their overheads if you want to get into more serious financial trouble those who already have.
Earlier this year other rating companies PSA had left four degrees below the inversion point, though curiously the titles of the French firm have risen by 7.2% in trading along the first quarter.
Keys to recover PSA are clear: rely less on Europe to open up more space base in China and South America, reducing structural costs of share-based investments for new products with General Motors, and that their new products ( 301, C-Elysee and 208) operate commercially, which seem to be doing.
