Last year the French motor manufacturer Peugeot-Citroen was forced to discount heavily to maintain its world car sales at 3,365,900, resulting in a drop in profits from € 1.03bn to only € 176m. In Europe itself a € 348m profit in 2005 turned into a net loss of € 127m for 2006, reflecting the loss of appeal of Peugeot’s ageing vehicle fleet.

Its operating profit, 3.4% in 2005, was cut to 2% in 2006. More demanding European pollution standards, and the rising cost of raw materials, make Peugeot’s position in the world car market look increasingly precarious.

This sad state of affairs could even bring an end to a brand better known in modern times for the creativity of its advertising than its automobile design, and for the involvement of the same family of industrial entrepreneurs for the past three hundred years.

The first of the family to show manufacturing flair was Jean Pequignot Peugeot, who built a series of identical wooden water mills in the second half of the eighteenth century. Around 1815, brothers Jean-Pierre and Jean-Frédéric Peugeot ran a steelworks and saw blade factory in the Montbéliard region that sold its products in 14 countries. As competition for standard steel blades began to intensifiy, in 1855 the Peugeots diversified into coffee grinders, then cut-throat razors for barbers. Montbéliard's gold engraver, Justin Blazer, was given the task of designing a trademark for steel articles made in the Peugeot Brothers factories and had the idea of a lion proudly striding along an arrow. It appeared on the Peugeot bicycle first made at Beaulieu in 1888 and demonstrated at the Paris exhibition a year later. The first five finishers in the Paris-Nantes cycling race of 1,025 kilometres all rode Peugeot machines, much to the delight of the new managing director, André Peugeot.

In 1896 Armand Peugeot founded the "Société Anonyme des Automobiles Peugeot" in Paris and Marseille. The official poster for the opening shows a couple wrapped in fur coats, sitting in a Peugeot car as it roars off, leaving behind a trail of smoke that spells out the new company's name.

The most successful pre-WW1 Peugeot was launched at the Paris motor show of 1912: the 6cv ‘Bébé’, whose hood and jointed windshield were designed by a young Italian from Milan, destined to become world famous: Ettore Bugatti. The Peugeot L76, specially designed for racing, won the French Grand Prix at Dieppe at an average speed of just over 110 kph. The following year Jules Goux won Indianapolis in an L76 and broke the world track record at Brooklands in the UK, reaching a speed of more than 170 kph.

Diverted into making tanks, aircraft engines and munitions during WW1, Peugeot re-established itself at major motoring events during the 1930s. In 1931 the smart 201 sedan came first in the Monte Carlo Rally and in 1938 the 402 was first in the supreme endurance test, the Le Mans 24-hour race. During WW2, Peugeot’s factories were occupied by the Germans but produced almost nothing of strategic importance, due to constant sabotage.
In 1982 came the first of several famous Peugeot commercials. Gerard Pirès's ground-breaking production depicted James Bond at the wheel of a 205 GTI: a chase sequence involving a plane, a train, a helicopter and a missile launcher. Bond ends up in the arms of a beautiful woman, who whispers ‘I almost waited’. Bond nonchalantly replies, ‘Had to be careful on a slippery road’.

The following year’s creation featured a deserted husband at the wheel of his 205, who spells out "Bitch" in the desert sand of Las Vegas, addressed to his wife, leaving on the plane flying overhead. This commercial was used in five languages and revived a short while ago.

In 1995 came the masterpiece made by Rémy Babinet to promote the Peugeot 406. The scene is a high speed crash test in the Peugeot factory, where two wooden dummies, instead of sitting calmly in their seats as the 406 smashes into the end wall, slam on the brakes and drive away in the car, to the incredulity of the watching engineers.