Peugeot 208 production will be cut in France

The Peugeot 208 is PSA's best-selling model in Europe.
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PARIS (Bloomberg) -- PSA/Peugeot-Citroen will eliminate one of two shifts that builds the Peugeot 208 subcompact hatchback at its factory in Poissy, France, to help reduce overcapacity.

The automaker plans to reassign the affected workers to other positions within the company, Pierre Olivier Salmon, a PSA spokesman, said today.

About 180 workers at the site near Paris will be impacted by the decision, said Christian Lafaye, head of the FO union at the automaker. French newspaper Les Echos reported the plan earlier today.

PSA said in December that it was launching an internal study to decide whether to close assembly lines in Poissy or at its Mulhouse plant in eastern France, which builds the Citroen C4 and Citroen DS4 compact models and the Peugeot 2008 subcompact crossover.

PSA builds the Citroen C3 and DS3 subcompacts alongside the 208 in Poissy.

The carmaker has already closed its plant in Aulnay near Paris as it struggles with excess capacity during a slump in European auto sales. It has been preparing the ground for further politically sensitive cutbacks.

CEO Philippe Varin said in September that production line shutdowns were under consideration, while PSA would avoid site closures. He told unions that Mulhouse and Poissy could be affected.

The Peugeot 208 is PSA's best-selling model in Europe, with 11-month deliveries in 2013 of 222,487, up from 140,070 in 2012, according to JATO Dynamics.

The model ranks No. 5 among Europe's best-selling cars, JATO data shows.

Automotive News Europe contributed to this report

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