PSA Peugeot Citroen’s decision to close a factory and cut an additional 8,000 jobs is unacceptable, French President Francois Hollande has said, pledging to lean on Europe’s second-biggest carmaker to renegotiate the plan.
Peugeot said on Thursday that it is to cut a total of 14,000 jobs and shut an auto plant in France for the first time in two decades to stem widening operating losses.
“The plan in the current state is not acceptable,” Hollande said on Saturday on French television.
Photo: AFP
Hollande was elected in May, promising to prevent a “parade of firings” after the election.
Peugeot’s shares plunged 7.7 percent on Friday on concern that the government may amend Peugeot’s decision to reduce costs and trim production, but there is not much wiggle room to do so, said Antonio Barroso, an analyst at the global risk research and consulting firm Eurasia Group in London.
“The range of options is limited,” Barroso said. “The Peugeot crisis is a powerful reminder of one of the most important problems facing France, which is lack of competitiveness.”
Hollande said he will consider incentives to spur sales of environmentally friendly cars and study the possibility of providing credit for vehicle purchases, though he will not adopt cash incentives like former French president Nicolas Sarkozy’s administration did to counter a recession in 2009.
With jobless claims at a 12-year high and the unemployment rate at 10 percent, Hollande said that generating jobs is his top priority. Besides Peugeot, companies including Air France-KLM Group, Carrefour and drugmaker Sanofi are mulling staff reductions in the face of stalling economic growth.
“It’s true we have a competitiveness problem,” Hollande said on Saturday. “There is an effort to be made, but it needs to be shared fairly.”
The government wants to avoid cutting salaries, but is considering shifting some social charges currently paid by employers to the social charges tax, which is paid on all forms of income including wages, pensions and capital gains.
The economic situation is already costing the Socialist president politically. Support for Hollande has dropped 7 points in the past month to 56 percent, according to an IFOP poll published on Wednesday. The survey of 1,005 voters has a margin of error of about 3 percentage points.
“Peugeot is an emblematic case that will leave its mark on people,” said Jerome Fourquet, a pollster at IFOP in Paris. “The political stakes are huge.”
Peugeot, Renault SA and Fiat SpA have posted the biggest sales declines this year in Europe, where Peugeot now expects the car market to contract 8 percent. The French carmaker has been consuming about 200 million euros (US$245 million) in cash monthly since the middle of last year.
The company will stop production at its 39-year-old factory in Aulnay, on the outskirts of Paris, in 2014. It will also lower production at a plant in Rennes to slash operational costs.
STRONG INTEREST: Analysts have pointed to optimism in TSMC’s growth prospects in the artificial intelligence era as the cause of the rising number of shareholders The number of people holding shares of chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) hit a new high last week despite a decline in its stock price, the Taiwan Depository and Clearing Corp (TDCC, 台灣集保) said. The number of TSMC shareholders rose to 2.46 million as of Friday, up 75,536 from a week earlier, TDCC data showed. The stock price fell 1.34 percent during the same week to close at NT$1,840 (US$57.55). The decline in TSMC’s share price resulted from volatility in global tech stocks, driven by rising international crude oil prices as the war against Iran continues. Dealers said
PRICE HIKES: The war in the Middle East would not significantly disrupt supply in the short term, but semiconductor companies are facing price surges for materials Taiwan’s semiconductor companies are not facing imminent supply disruptions of essential chemicals or raw materials due to the war in the Middle East, but surges in material costs loom large, industry association SEMI Taiwan said yesterday. The association’s comments came amid growing concerns that supplies of helium and other key raw materials used in semiconductor production could become a choke point after Qatar shut down its liquefied natural gas (LNG) production and helium output earlier this month due to the conflict. Qatar is the second-largest LNG supplier in the world and accounts for about 33 percent of global helium output. Helium is
China is clamping down on fertilizer exports to protect its domestic market, industry sources said, putting an additional strain on global markets that were already grappling with shortages caused by the US-Israeli war on Iran. China is among the largest fertilizer exporters — shipping more than US$13 billion of it last year — and it has a history of controlling exports to keep prices low for farmers. Shipments through the war-blocked Strait of Hormuz account for about one-third of the sea-borne supply. This month, Beijing banned exports of nitrogen-potassium fertilizer blends and certain phosphate varieties, sources said. The ban, which has not
DOMESTIC COMPONENT: Huang identified several Taiwanese partners to be a key part of Nvidia’s Vera Rubin supply chain, including Asustek, Hon Hai and Wistron Nvidia Corp chief executive officer Jensen Huang (黃仁勳), addressing crowds at the company’s biggest annual event, unveiled a variety of new products while predicting that its flagship artificial intelligence (AI) processors would help generate US$1 trillion in sales through next year. During a two-and-a-half-hour keynote address, Huang announced plans to push deeper into central processing units (CPUs) — Intel Corp’s home turf — and introduced semiconductors made with technology acquired from start-up Groq Inc. The company even said it was developing chips for data centers in outer space. At the heart of Huang’s speech was the message that demand for computing power
RSS