Peugeot Citroen today said its sales slumped in the first quarter as Europe's recession-hit markets caused car sales to collapse across the region's southern flank.

The Paris-based car maker says it made 15.4 billion Euros (£12.6 billion) in the first quarter, down 7% from a year earlier.

The car maker, which has traditionally sold well in Spain, France, Italy and Greece, blamed the collapse of markets in southern Europe for the weak quarterly performance.

Overall, Peugeot Citroen sales contracted 20% across all of Europe with falls of 19.4% in France and 22.4% in Italy.

In a statement the company said it expected the European market to be down by about 5% over the full year, and by about 10% in France.