News / Business

Peugeot Citroen to slash over 2,000 jobs

Monday, 17 October 2016 6:45 PM [ Last Update: Tuesday, 18 October 2016 6:21 AM ]

French automaker PSA Peugeot Citroen is preparing to slash over 2,000 jobs its home market next year.

PSA Peugeot Citroen has announced plans to cut more than 2,133 jobs in the home market France next year in what appears to be a fresh sign of trouble for the French auto giant.

News agencies cited internal documents as saying that the job cuts – which will be equal to three percent of the company’s workforce - will be carried out through a combination of early retirements and voluntary buyouts.

The company’s management has been quoted as saying in internal documents that uncertainty over Brexit and falling sales of diesel vehicles mean PSA must be "cautious".

PSA Peugeot Citroen has already slashed 17,000 jobs in three straight annual job cuts since early 2013, Reuters said in a report quoting France Info radio.

Labor unions reacted strongly to the plan.

"PSA prepares a fourth job-cutting plan. It's a true scandal," Reuters quoted Jean-Pierre Mercier, a member of the CGT labor union at PSA, as telling RTL radio on Monday.

Since emerging in 2014 from a brush with bankruptcy and a government-backed bailout, PSA has pledged to cut labor costs, inventory and model line-ups to restore profitability.

The company came close to bankruptcy two years ago and needed a government-backed bailout. As a result it is currently 14 percent owned by the French state and 14 percent by Chinese vehicle manufacturer Dongfeng, euronews reported.

Since the bankruptcy scare it has pledged to cut labor costs and inventory as well as the number of different models it makes to become profitable again.

Peugeot Citroen did deliver a record profit in the first-half of 2016 and has said it is considering paying a dividend to shareholders for this year, euronews added.

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