This is a common problem when running an older car, in that eventually the cost of keeping it on the road ends up being a large proportion of the car's actual value, or possibly in this case more than the car is actually worth.

If you want to keep the car long-term and are happy to spend the money to have it repaired then there is nothing necessarily wrong with this option, but it is worth bearing in mind that you are likely to continue to experience problems as the car ages, and keeping it in working condition will continue to cost significant sums of money. You may wish to consider what you can buy as a replacement for £2000, plus any money you can recoup from selling the Peugeot.