Jan. 31 (Bloomberg) -- PSA Peugeot Citroen labor leaders squared off against one another over a plan to eliminate 17 percent of the automaker’s French workforce, with three of the five main unions urging immediate action to stem losses.
“I am extremely worried by the company’s current situation,” Christian Lafaye, the FO union leader, told reporters today in Paris. “If it files for bankruptcy tomorrow, I wouldn’t be surprised. The more we are waiting for the restructuring plan, the worse it will be.”
Lafaye said Peugeot is losing 7 million euros ($9.5 million) per day and can’t afford to delay a restructuring being blocked by a Paris court following challenges to those efforts by the CGT union. The CGT is also striking at a Peugeot plant on the outskirts of the French capital that’s being closed.
The unions are clashing over both the shutdown and plans by Europe’s second-largest carmaker to shrink its French operations by 11,200 posts over the next two years. Automakers have announced 30,000 job cuts in Europe since the beginning of July in response to the region’s prolonged slump. Europe’s car market is forecast to drop to 12.3 million vehicles this year, 23 percent below the pre-crisis peak, IHS Automotive estimates.
About 120 Peugeot workers went on strike in Aulnay earlier this week, slowing production to about 100 cars from a normal daily output of about 500. Renault SA employees also have walked off the job as the French carmaker works toward eliminating 7,500 positions,
“I strongly condemn these defamatory accusations that try to tarnish the current strikes,” said Jean-Pierre Mercier, deputy head of the CGT union at Peugeot.
Peugeot dropped 22 cents, or 3.6 percent, to 5.74 euros in Paris trading today. The stock has plummeted 53 percent in the last 12 months, valuing the automaker at 2.04 billion euros.
The Paris court said this week that Peugeot can’t eliminate jobs until Faurecia SA, 57 percent-owned by Peugeot, informs its workers about the impact of the carmaker’s restructuring. Faurecia is itself aiming to cut about 3,000 jobs in its home region by the end of 2013.
French workers are shielded by labor laws requiring employers to take extensive steps to ensure employees are regularly and fully informed about job-cut proposals.
European auto sales plunged 16 percent in December, bringing the decline for the year in the region to 7.8 percent, according to the Brussels-based European Automobile Manufacturers’ Association, or ACEA. Peugeot deliveries in the region in 2012 dropped 13 percent.
Peugeot “welcomes the responsible attitude” of the three unions supporting the restructuring “in a context of an environment of sustained recession in the European markets and the difficult situation this creates for the group,” the Paris-based automaker said in a statement.
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