Azerbaijan, Baku, March 6 /Trend S.Isayev, T. Jafarov/
The problems of Peugeot are not limited to the sanctions imposed on Iran, French ambassador to Tehran, Bruno Foucher said, ISNA reported.
Foucher noted that one of other factors that affected Peugeot is the fact that European car market suddenly dropped from 16 million cars to 10 million.
"Peugeot has been thinking about remodeling," Foucher said. "In Iran Peugeot would produce large number of cars, however the problems affected company's activity."
Press TV reported last month that PSA Peugeot Citroen, has posted the largest annual revenue loss in its history, partly caused by the West's sanctions against Iran.
Iran was the French car maker's second-biggest market in 2011 in terms of trade volume.
In February 2012, PSA Peugeot Citroen stopped its trade with Iran after the enforcement of US-led financial sanctions against the Islamic Republic for its nuclear energy program.
The French car making group also halted its exports of vehicles to Iran, which accounted for around 13 percent of the firm's global deliveries in 2011.
It cost the automaker the annual sale of half a million cars and an estimated 1.5 billion euros in revenue last year.
Foucher also said that economic exchange between countries has declined, standing currently at $1 billion per year.
"We are not enjoying this situation one bit. The situation is very unfortunate," Foucher said. "EU foreign policy Chief Catherine Ashton said the sanctions would be lifted, and of course it depends on whether the solution to the Iranian nuclear issue is found."
The U.S. and its Western allies suspect Iran of developing a nuclear weapon - something that Iran denies. The Islamic Republic has on numerous occasions stated that it does not seek to develop nuclear weapons, using nuclear energy for medical researches instead.
Despite the rules enshrined in the Non-Proliferation Treaty (NPT) entitling every member state, including Iran, to the right of uranium enrichment, Tehran is now under four rounds of UN Security Council sanctions for turning down West's calls to give up its right of uranium enrichment.