PSA/Peugeot-Citroen opens a third assembly plant in China today, expanding in the world’s largest vehicle market even as a slump in European demand prompts it to cut jobs at home.
The factory, opened with Dongfeng Motor Corp. in Wuhan in China’s central Hubei province, will produce the Citroen C-Elysee and Peugeot 301 sedans and increase the company’s annual capacity by two-thirds to 750,000 units by the end of 2015.
PSA’s expansion in China contrasts with its job cuts in France. The money-losing Paris-based automaker, which produced 40 percent of its vehicles at home last year, reported a 576 million-euro ($750 million) operating loss last year and has started implementing a restructuring plan that includes closing a factory on the outskirts of the capital and eliminating 11,200 positions in the country.
“China is probably the only way for PSA to get out of their difficulties in Europe,” said Klaus Paur, global head of automotive at industry researcher Ipsos in Shanghai.
Chosen excerpts by Job Market Monitor
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