French car industry sinks to lowest level in 15 years

There was bad news for the French car industry this week as new figures revealed it was at its lowest ebb in 15 years. Predictions for the year ahead are not too rosy either.

French car industry sinks to lowest level in 15 years
Workers from PSA Peugeot Citroën protest against the closure of their factory at Aulnay-sous-Bois. The French car industry has hit its lowest ebb in 15 years. Photo: Eric Piermont/AFP

The French auto market sank to its lowest level in 15 years last year with 1.79 million new cars sold and with only a hesitant rebound expected in 2014, data published Thursday showed.

Sales fell by five percent in 2013, figures from CCFA manufacturers association said. Light utility vehicles sales fell by 4.4 percent, it added.

"The 2013 vintage is to be forgotten," said auto market analyst Flavien Neuvy of Cetelem credit company.

According to CCFA, sales were at their worst in the early part of 2013, following on from a bad 2012 but recovered gradually in the second half.

In December, sales rose 9.4 percent, perhaps boosted by consumers anticipating a sales tax hike that kicked in on January 1.

French automakers PSA Peugeot Citroen and Renault made up 53 percent of the French car market last year, with Renault's Clio IV the best sold model.

Renault sales inched up 0.8 percent over the year, while PSA Peugeot Citroen sold 7.7 percent fewer vehicles.

The world's biggest carmaking group, Volkswagen saw sales in France fall by 8.1 percent while sales by US group General Motors plummeted by 15.8 percent and Ford lost 17.3 percent.

Toyota sales rose 5.5 percent and Fiat, which completed a merger with Chrysler on Wednesday, rose 2.4 percent.

"We've touched the bottom of the pool and the market will remain stable in 2014," a CCFA spokesman said. Car sales in France ended the year at the same level as in 1997.

Elsewhere in Europe, Spanish car sales increased by 3.3 percent in 2013 while sales in Italy lost 7.1 percent.

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New Air France chief announces first job cuts

The new chief executive of Air France has proposed the first job cuts for the strike-prone airline since taking over eight months ago, with up to 465 voluntary redundancies announced on Monday.

New Air France chief announces first job cuts
Photo: AFP
The cuts have been earmarked for its short-haul business in France, which lost 189 million euros ($212 million) in 2018 and is expected to make further losses in the years ahead, the company said in a statement.
It intends to close or reduce the number of flights on loss-making routes and make use of smaller aircraft to reduce costs, as it confronts fierce competition from low-cost rivals and France's high-speed train network. 
The cuts will accompany a reduction in capacity of 15 percent by 2021, the company said, with ground staff and customer services personnel set to be offered the voluntary redundancy packages.
“This plan will shortly be the subject of a consultation with relevant stakeholders. There will be no forced departures,” the airline said.
Canadian Ben Smith was named as the first non-French chief executive of Air France-KLM last year despite strong resistance from the group's powerful trade 
The Franco-Dutch group, formed out of a merger of Air France and KLM, has also been caught in a power struggle between Paris and the Hague. 
In February, the Netherlands purchased 14 percent of the airline, nearly matching the 14.3 percent held by France, sparking tensions over control and French warnings of instability in its management.
The move by the Netherlands was prompted by doubts over the alliance's strategy and worries that Dutch interests were being neglected. 
Air France said Monday that its domestic operations had lost 717 million euros in total since 2013.