PARIS (Reuters) -- PSA/Peugeot-Citroen will invest 150 million euros ($187 million) over the next three years in the production of new models at its factory in Poissy, near Paris, unions said today.
The move will safeguard the plant's future for at least 10 years in return for cutbacks agreed with workers' representatives, unions said.
PSA briefed unions on plans to upgrade Poissy as part of an earlier 1.5 billion euro investment pledge to increase French production in return for job cuts and productivity gains.
Poissy, which builds the Citroen C3, Peugeot 208 and DS3 subcompacts, will start producing a compact vehicle in 2018, Jean-Francois Kondratiuk, an FO union official who sits on the PSA board, said.
That commitment effectively guarantees that the plant's continued activity "at least until 2025," Kondratiuk added.
Production in Poissy will be reduced to a single line early next year as the company concentrates assembly of the C3 in Slovakia.
3 billion euro bailout
PSA was hit hard during a recent prolonged auto-market slump in Europe and sought a 3 billion euro bailout, which saw the French state and China's Dongfeng each take 14 percent stakes in the automaker earlier this year.
Under a 2013 labor deal with unions aimed at cutting costs and combating overcapacity, the company is scrapping assembly lines to shrink plants in France.
In 2013, the automaker closed its plant in Aulnay, France.