PSA Peugeot-Citroen May Cut up to 10 Percent of its French Workforce, Equal to 10,000 Jobs

The dark clouds over Europe are having a profound effect on the auto industry, especially outside the continent's powerhouse that is Germany. 

 

A PSA Peugeot Citroen union official told reporters today that the company might eliminate up to 10,000 jobs or about 10 percent of its total workforce in France to compensate for dwindling sales. 

 

Under a previous austerity plan announced in November of 2011, the French group had said that it would cut 6,000 positions through layoffs in its local operations. 

They will raise the job cuts target in France alone to 8,000-10,000,” said Christian Lafaye, head of Peugeot’s second biggest union FO, according to Bloomberg News.

 

Last week, PSA Peugeot Citroen CEO Philippe Varin told unions that after the company's European sales plunged 15 percent in the first five months of the year versus a 7.3 percent industry-wide fall, the automaker would need to increase its 2012 savings target of €1 billion (US$1.25 billion).

 

The French group, which declined to comment on the reports, is expected to meet with union representatives to present the new cost cutting measures later this month.

In April, PSA Peugeot-Citroen sold its Parisian headquarters for €245.5 million to lower its mounting debts.