Cutbacks at Peugeot and Renault meet growing resistance

Tue Jan 29, 2013 12:17pm EST
 

By Gilles Guillaume and Laurence Frost

PARIS (Reuters) - Labour tensions at France's carmakers took a turn for the worse on Tuesday as Renault (RENA.PA: Quote) workers protested over planned cuts and PSA Peugeot Citroen's (PEUP.PA: Quote) restructuring plan hit a legal setback.

While Renault staff demonstrated at the company's Flins plant west of Paris and Peugeot workers marched on company headquarters, the carmakers pursued union talks on plans to improve productivity and eliminate close to 8,000 jobs each.

"As things stand now, the conditions are unacceptable," CFDT union chief Laurent Berger said of Renault's proposals for a new nationwide labour deal.

Peugeot, the carmaker worst hit by Europe's deep auto sales slump, is struggling to shed costs and lift sales in its effort to return to profit in 2015. Renault, cushioned by earnings from its Dacia low-cost cars and a 43.4 percent stake in Japan's Nissan (7201.T: Quote), is also grappling with industrial overcapacity as sales of French-built models plunge.

The CFDT, France's biggest private-sector union, also increased pressure on Renault boss Carlos Ghosn by echoing calls from within President Francois Hollande's socialist government for a cut to the chief executive's salary.

"Workers can't be asked to make sacrifices unless the CEO is asked to make sacrifices," Berger said on BFM Television.

The government, Renault's biggest shareholder with a 15 percent stake, attempted to trim Ghosn's pay at a board meeting in December, Finance Minister Pierre Moscovici said in a Monday radio interview, without giving details.

Ghosn earned 2.79 million euros ($3.76 million) from Renault in 2011 and 9.92 million from Nissan in its corresponding financial year, making him one of the highest-paid CEOs in France or Japan.   Continued...

 
Employees of French car maker Renault demonstrate against the company's new labour deal in front of the Renault car factory in Flins, near Paris, January 29, 2013. The carmaker was aiming to cut 7,500 jobs in France by 2016 to help boost competitiveness as the slump in its domestic and European markets shows no sign of easing. REUTERS/Christian Hartmann