Peugeot board sacks boss

PSA Peugeot Citroen ousted chief executive Christian Streiff yesterday as France's biggest carmaker struggles in the international economic crisis.

"Given the extraordinary difficulties currently faced by the automotive industry, the supervisory board decided unanimously that a change in the senior leadership position was necessary," said supervisory board chairman Thierry Peugeot in a statement.

The company said Mr Streiff will be replaced by Philippe Varin, 56, current chief executive of the Anglo-Dutch steel group Corus, who will take over as PSA chief on June 1.

PSA last month announced a €343-million loss for last year, after 885 million euros in profits in 2007, and is forecasting more losses this year as the economic slowdown hits manufacturers hard.

It said last month it would reduce its workforce by about 11,000, warning that the European car market could slump by a fifth this year.

In February France's government gave PSA and Renault three billion euros each in loans to shore them up and billions more to their many suppliers to help them weather the storm.

Peugeot promised President Nicolas Sarkozy that it would not sack staff or close plants in France this year in exchange for the loan.

One in 10 workers in France is employed by the car industry and Mr Sarkozy has made clear he will not allow carmakers to fail as consumer demand for cars collapses.

Recent press reports had cited tension between the Peugeot family, which owns just over 30 per cent of the firm and has majority voting rights, and Mr Streiff over the company's strategy.

Mr Streiff took over the job in February 2007 and tried to make the giant auto maker more profitable by controlling costs and boosting its international presence.

The company statement credited his replacement, Mr Varin, with turning round Corus's fortunes after coming to that company's helm in 2003. He notably oversaw Corus's merger of India's Tata Steel in 2007.