PARIS – PSA/Peugeot-Citroen faces opposition but limited action so far from French politicians and union officials over plan to slash 6,000 full-time and temporary jobs, with the majority of the cuts coming in France. News of the job losses came just a day before PSA announced last week that it would invest another 960 million euros in its Brazilian operations from 2012-2015.
French Minister of Industry Eric Besson said he plans to meet with PSA CEO Philippe Varin to discuss the automaker's job-cut plan, but while outwardly critical of the move, the French government has not communicated any specific measures it might take against PSA. CGT, PSA's largest union, has protested PSA's staff reductions in France, but thus far has not threatened PSA with work stoppages.
"To put it bluntly, PSA certainly has more legal and technical leeway [for staff reductions] than Renault, which would have to get, somehow, the state's approval or take the risk" of serious backlash, said Carlos Da Silva, a market analyst at IHS Automotive. The government has more sway at Renault because of its 15 percent stake in the automaker.
Da Silva thinks that PSA is emphasizing that the cuts are Europewide and not only in France to keep from upsetting the French government, which loaned the automaker 3 billion euros in 2009 to help it survive the global economic slowdown. Renault also was loaned 3 billion euros.
"By accepting the state loan, PSA committed to maintaining a strong activity and presence in it homeland, certainly explaining what's happening now, a European [job-reduction] plan, not a French one," Da Silva said.
However, the French government can still apply pressure on PSA to keep jobs in France, Da Silva said. For example, the government could say it would no longer be as willing to support PSA with loans or other bailout measures during a future crisis, Da Sliva said.
The government could also make other kinds of threats, such as saying it could change its rebate policies on hybrid cars that PSA makes. "PSA is just coming out with its own diesel hybrids, but the government could say that bonus only applies to [gasoline-powered] hybrids," Da Silva said. "No one can imagine this happening, but this is just to say that, if they want, politicians can find ways of annoying PSA."