PSA Peugeot-Citroen to axe 8,000 jobs as euro woes hit key markets
FEARS mounted yesterday of fresh job losses and plant closures in Europe’s bloated car industry after French giant PSA Peugeot-Citroen took the axe to 8,000 posts.
Analysts said other manufacturers considering or engaged in restructuring included Fiat, Opel and Renault as the industry fights chronic overcapacity in a market that has shrunk by 20 per cent since 2007.
Earlier this year, Carlos Ghosn, the chief executive of Renault and its Japanese alliance partner, Nissan, predicted that the first major restructuring by a European car maker could open the floodgates to a rash of plant closures.
“The day somebody’s able to restructure heavily in Europe, it’s going to force all car makers to do it,” he said in March.
Peugeot’s move, which includes the closure of an entire assembly plant near Paris, may raise concerns closer to home where the news flow has been largely positive of late.
Jaguar Land Rover, Mini, Nissan and Vauxhall are among the car firms investing heavily in their UK operations thanks to strong export demand.
Peugeot has been battling mounting losses and shrinking demand for larger cars such as its 508 and Citroen C5 models. Its Aulnay plant near the French capital, which currently employs more than 3,000 workers, will halt in 2014, becoming the first car factory to cease production in France for 20 years. Thousands of non-assembly jobs are also to be scrapped across the group.
Chief executive Philippe Varin said: “I am fully aware of the seriousness of today’s announcements. The depth and persistence of the crisis impacting our business in Europe have now made this reorganisation project indispensable.”
Erich Hauser, a London-based automotive analyst with Credit Suisse, said: “This is a company that has run out of options.”