union official say, PSA offers French factory pledges for labor deal

union official say, PSA offers French factory pledges for labor deal

PSA/Peugeot-Citroen has offered commitments to produce at least 1 million vehicles annually in France over the next three years and keep all domestic plants open, a union official said on Wednesday.

PSA told workers’ representatives it expects to manufacture 930,000 vehicles in France this year, CFTC union official Franck Don also said.

The pledges, made by CEO Philippe Varin in the latest round of talks with unions, depend on the successful conclusion of a new labor deal including wage restraint, increased flexibility and internal transfers.

The carmaker outlined plans last year to stop manufacturing at its Aulnay site near Paris, which employs about 3,300 full-time workers, at an unspecified point in 2014 in a reorganization aimed at restoring profit as the European auto market shrinks.

PSA, which reported a 576 million euro ($753 million) operating loss last year, has been selling businesses and has a two-year plan to eliminate 11,200 jobs, or 17 percent of its French work force.

A company spokesman declined to comment.

PSA’s eight-month sales in EU and EFTA markets fell 12 percent to 899,417 vehicles, according to industry association ACEA. The overall European auto market contracted 5 percent in the same period.