Sept. 5 (Bloomberg) -- PSA Peugeot Citroen, Europe’s second-biggest carmaker, will ask French workers to cut overtime pay and accept more flexible working conditions to slash fixed costs, a person briefed on the matter said.
The Paris-based company will meet with unions later today to propose cutting additional overtime pay by 20 percent to 25 percent, and lowering added money for working night shifts by 3 percent to 15 percent, said the person, who asked not to be named because the discussions are private.
The French automaker is seeking about 600 million euros ($792 million) in annual savings by 2016 through its current restructuring plan and these additional measures, the person said. In exchange, Peugeot management would guarantee not to close any additional French plants and keep worker’s base salaries at current levels, the person said.
Pierre-Olivier Salmon, a spokesman for Peugeot, declined to comment.
Peugeot, which posted a first-half operating loss of 510 million euros in its automotive division, plans to eliminate 11,200 jobs in France by 2015 and will close the Aulnay factory on the outskirts of Paris. Chief Executive Officer Philippe Varin pledged to cut the manufacturer’s cash-consumption rate by 50 percent in 2013 after burning through 3 billion euros last year.
Peugeot management will also ask unions to accept more flexible working conditions that would allow the carmaker to have workers stay at home on days when no work needs to be done, the person said.
--Editors: Chad Thomas, Heather Harris