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.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
US CONSCULTANT: The US Department of Commerce’s Ursula Burns is a rarely seen US government consultant to be put forward to sit on the board, nominated as an independent director Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), the world’s largest contract chipmaker, yesterday nominated 10 candidates for its new board of directors, including Ursula Burns from the US Department of Commerce. It is rare that TSMC has nominated a US government consultant to sit on its board. Burns was nominated as one of seven independent directors. She is vice chair of the department’s Advisory Council on Supply Chain Competitiveness. Burns is to stand for election at TSMC’s annual shareholders’ meeting on June 4 along with the rest of the candidates. TSMC chairman Mark Liu (劉德音) was not on the list after in December last