France's leftist rulers reel as Peugeot axes jobs
AULNAY-SOUS-BOIS, France |
AULNAY-SOUS-BOIS, France (Reuters) - France's left-wing government faced its first serious industrial crisis as trade unions vowed to "wage war" over the announcement on Thursday that PSA Peugeot Citroen will axe 8,000 jobs and shut the first car factory in 20 years.
The news, broadcast to angry workers over loudspeakers at the doomed plant in Aulnay-sous-Bois, a depressed northeastern Paris suburb, came two months after Socialist President Francois Hollande won power pledging to reverse industrial decline.
As distraught staff downed tools, Prime Minister Jean-Marc Ayrault promised the government would present plans to support the flagging car sector by July 25 and ensure that Peugeot delivered on promises to help axed staff find work.
Everyone concerned would be summoned to talks with Arnaud Montebourg, the Minister for Industrial Renewal, whose ambitious title looks increasingly threadbare amid a wave of layoffs by companies hurt by Europe's economic slowdown.
"We cannot accept PSA's plans as they stand," Montebourg told parliament. "We are asking PSA to examine in good faith any options there may be other than what it has in store for its factories in France, their workers and their families."
Appearing on the national evening news to hammer home his point, Montebourg said he would meet with unions in the coming days to look at possible alternatives.
"This is an earthquake for the French economy," he told TF1, adding that the car industry had received 4 billion euros of aid just a few years ago, in the form of government loans, a popular cash-for-clunkers scheme and various other schemes.
"The government wants the truth," he said.
With unemployment at its highest since 1999 and the economy stagnating, the new government has vowed to create 150,000 state-aided jobs over five years and ramp up the cost to companies of laying off workers, without saying how.
Peugeot's announcement highlighted how hard it will be to make good on Hollande's promise to fight excessive redundancy programs in an economic downturn. Unlike rival Renault, PSA does not have the state as a shareholder.
Union leaders at Aulnay, where 3,000 jobs will be lost, raised the stakes when PSA Chief Executive Philippe Varin finally confirmed what had long been an open secret.
"Varin wants to wage war against us. Well, we are going to wage war on him," Jean-Pierre Mercier, local leader of the hardline CGT labor union, declared outside the gates of the sprawling factory. "We won't sell our skin cheaply."
His defiant tone echoed protests by steelworkers in eastern France whose high-tech plant has been idled by ArcelorMittal on similar grounds to those of the carmaker - flagging demand.
The plight of workers at the Florange steel mill dogged former president Nicolas Sarkozy's unsuccessful re-election bid, playing into the hands of Hollande, his Socialist challenger.
The new president can blame his predecessor over Peugeot - Labor Minister Michel Sapin accused Sarkozy of having told the company's chief executive to keep the closure plan under wraps until after the April-May presidential election.
But the shutdown will test the credibility of Hollande's campaign promise to restore France's industrial fabric after years of neglect.
The country has lost 763,000 industrial jobs in the last 10 years with 355,000 shed in Sarkozy's five years - figures Hollande rarely omits from speeches about industrial policy.
The president left his prime minister to lead the government response to the Peugeot plan, although his office said Hollande was "extremely concerned" and had urged ministers to do everything to limit the social damage.
The last time France had a Socialist-led government, then Prime Minister Lionel Jospin got into trouble for saying there was little the state could do about Renault's plans to close a factory at Vilvoorde in Belgium.
That comment returned to haunt Jospin when dissident candidates split the left-wing vote in the 2002 presidential election and prevented him reaching the runoff, ending his political career.
(Additional reporting by Elizabeth Pineau, Daniel Flynn and Vicky Buffery; Editing by Paul Taylor and Peter Graff)
- Tweet this
- Share this
- Digg this