French carmaker Peugeot Citroen has set out plans to cut 8,000 jobs and close an assembly plant outside Paris as losses mount.
Peugeot said the Aulnay plant near Paris, which employs 3,000 workers, would stop production in 2014.
Last week, Peugeot said its first-half sales had fallen 13% amid a “profound crisis” in its eurozone markets.
Another plant, at Rennes in western France, is set to shed 1,400 posts from the 5,600 it employs there.
Another 3,600 jobs would be lost across all facilities in France.
PSA Peugeot Citroen’s jobs cut announcement is a sign of the problems faced by mass-market carmakers in Europe.
Over the past couple of years, companies that make high profit margins from selling luxury cars, such as Audi, BMW and Mercedes, have done very well.
Relative newcomers Kia and Hyundai have also enjoyed great success, with competitively priced models made in ultra-modern, hi-tech factories in the Czech Republic and Slovakia.
Traditional mass-market carmakers, such as Peugeot, as well as Renault, Opel/Vauxhall, Ford, Fiat and Toyota, are stuck with old-fashioned factories and well-paid workers demanding more.
Unable to compete with the newcomers on price and without the brands needed to attract profitable luxury buyers, they find themselves stuck in the middle where the European motor industry’s excess capacity is most acute.
“I am fully aware of the seriousness of today’s announcement, as well as of the shock and emotions they will arouse in the company,” he said in a statement.
He said “the depth and persistence of the crisis” made the reorganisation necessary and that workers who lost their jobs would receive support and help in finding new employment.