PSA job cut strikesCar maker PSA Peugeot Citroen says it lost 819 million euros (£637 million) in the first half of the year, underscoring the difficulties the company faces amid a looming battle with the French government over its restructuring plan.

The maker of two-thirds of France's cars is in a tailspin amid a deepening recession in many of its most important markets in southern Europe.

In response, the company announced earlier this month that it would close a major factory and cut 8,000 jobs.

President Francois Hollande's administration has said the plan is unacceptable and that it will force it to save some of those jobs.

Peugeot said that revenue for January to June was 29.6 billion (£23 billion), down 5.1% since last year but still higher than many analysts expected.

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