Peugeot Citroen announces 8,000 job cuts, plant closure

PanARMENIAN.Net - French automaker PSA Peugeot Citroen announced 8,000 job cuts and a plant closure as it struggles with mounting losses, actions that could spark more restructuring and political tension in Europe, according to Reuters.

The Aulnay plant near Paris, which employs more than 3,000 workers to build the Citroen C3 subcompact, will end production in 2014 as Peugeot reorganizes its under-used domestic capacity, the company said on Thursday.

Aulnay will become the first French car plant to close in two decades, challenging new Socialist President Francois Hollande's pledge to revive domestic industrial production.

"I know how serious these measures are for the people concerned, and for our entire company," Chief Executive Philippe Varin told reporters."But a company can't preserve jobs when it's burning 200 million euros (US$245 million) a month in cash," he said. "Prevaricating would have put the group in great danger."

Peugeot said another plant in the western city of Rennes would let go of 1,400 workers as it shrinks in step with demand for larger cars such as the Peugeot 508 and Citroen C5.

Some 3,600 non-assembly jobs will also be scrapped across the country.

Combined with France's share of 6,000 European job cuts announced last year, the latest measures will reduce Peugeot's 100,000-strong domestic workforce by close to 10 percent, excluding subcontractors and service providers.