April 1 (Bloomberg) -- PSA Peugeot Citroen, Europe’s second-largest carmaker, will increase production of the 2008 compact sport-utility vehicle after receiving 120,000 orders for the model.
Peugeot will raise daily assembly of the urban crossover, which has characteristics of a SUV and sedan, by 25 percent to 860 vehicles, the Paris-based automaker said in a statement today. A plant in Mulhouse, France, will add a partial shift to meet the higher demand, with positions being filled internally.
The automaker is raising production of the 2008 for the fifth time since its introduction last April, Pierre-Olivier Salmon, a company spokesman, said in an e-mail.
The French manufacturer has also seen robust demand for the new 308 hatchback, which won Europe’s Car of the Year award at the Geneva auto show last month. Peugeot plans to build more of that model after receiving 60,000 orders. The production increases mark a possible turning point for the carmaker, which closed a factory in the Paris suburb of Aulnay last year and has been working to eliminate 11,200 domestic jobs.
Peugeot gained as much as 3 percent to 14.10 euros, the highest intraday price since Feb. 28, 2012, and was trading up 2.3 percent as of 10:19 a.m. in Paris. The stock has surged 48 percent this year, valuing the French automaker at 5 billion euros ($6.8 billion).
The European market share of Peugeot and its sister brand Citroen narrowed to 10.9 percent last year from 11.7 percent in 2012, according to figures from the ACEA industry group. The group’s sales in the region in January and February gained 5.2 percent to 218,062 vehicles. Peugeot’s French sales of cars and light commercial vehicles jumped 14 percent in March as the market expanded 7.7 percent, the country’s carmaker association said today.
Peugeot, which racked up more than 6 billion euros in losses during the past two years, signed an agreement last week with Chinese partner Dongfeng Motor Corp. and the French state under which they will contribute about half the money for a planned 3 billion-euro capital increase in exchange for a 14 percent stake each. The founding family’s ownership will drop to 14 percent from the 25.5 percent because of the deal.
Former Renault SA executive Carlos Tavares took over yesterday as Peugeot’s chief executive officer, replacing Philippe Varin.