Watch Live

Tweet TWEET

Peugeot Plans to Help its Workers Find New Employers

PSA Peugeot Citroen (UG), seeking to stem losses in Europe, plans to help its own workers find gainful employment elsewhere.

Europe’s second-largest carmaker intends to set up job centers in France in an effort to reduce its workforce at home 17 percent by 2015, according to an internal document obtained by Bloomberg News.

The “external jobs service,” part of the Paris-based company’s human resources department, plans to advertise jobs outside Peugeot to the manufacturer’s employees, according to a draft agreement sent on July 16 to French union leaders as part of negotiations to trim costs. Jean-Baptiste Thomas, a spokesman for Peugeot, confirmed the plans by phone.

Peugeot’s French auto workers will also be offered help in setting up their own businesses as well as the option of taking unpaid leave for as long as two years with the guarantee of returning to a similar job if their alternatives don’t pan out.

The measures, which are geared to limiting forced dismissals, are part of Peugeot’s push for a so-called social contract with French unions. The company is implementing a restructuring plan that includes 1.5 billion euros ($1.96 billion) in cost cuts and eliminating 11,200 jobs in its home country.

Peugeot is struggling to return to profit with industrywide car sales in Europe set to shrink for the sixth consecutive year. The French automaker’s first-half vehicle sales dropped 9.8 percent from a year earlier to 1.46 million cars. The decline was held in check by a push to boost sales abroad.

Cash-Burn Pledge

Chief Executive Officer Philippe Varin has pledged to reduce cash consumption by 50 percent this year after running through 3 billion euros in 2012. The company’s goal is to end the outflow of cash next year.

Peugeot is holding its eighth round of negotiations with French unions today. Philippe Dorge, executive vice president for human resources, will hold a press conference on the progress tomorrow.

Talks on working conditions, which may include changes to pay and working hours, haven’t yet started, Thomas said. Peugeot’s management hopes to reach an agreement with unions by the fall, Thomas said.

To contact the reporter on this story: Mathieu Rosemain in Paris at mrosemain@bloomberg.net

To contact the editor responsible for this story: Chad Thomas at cthomas16@bloomberg.net

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.