Unique way to reduce payroll
Cutting jobs in France is never easy. So Stellantis NV, the manufacturer of Peugeot cars and Jeep SUVs has come up with a novel way to slim down its payroll: It sends workers emails with tips on how to get exciting new jobs—elsewhere.
Employees are routinely sent alerts on career fairs and services that help write winning CVs -so much so that union representatives are accusing management of harassment. This isn’t a good way to motivate people to work hard for the company,” said Christine Virassamy, a representative of the CFDT union. “We’ve asked them to let up.”
The unusual effort is a measure of how hard pressed Chief Executive Officer Carlos Tavares is to cut the sprawling automaker’s payroll in major markets in Europe as he strives to make good on 5 billion euros ($5.7 billion) of synergies pledged as part of the 2021 merger between Fiat Chrysler and PSA Group. France alone could see as many as 10,000 departures by the end of 2025, according to estimates by some unions.
Under pressure
Like rivals across Europe rapidly shifting to electric vehicles (EV), Stellantis—with 14 car brands and some 300,000 employees globally -is under pressure to trim its workforce. EVs are simpler to produce and require fewer workers than conventional vehicles. Emails promoting career moves outside Stellantis are to help those who might be interested in a voluntary departure scheme, a company spokesman said.
“The transition to EVs is unprecedented in terms of speed and impact for the automotive industry,” said Alexandre Marian, a managing director in Paris at AlixPartners. “There will be winners and losers given the level of investment required, and this will have implications on the workforce.”
In a study published in December for France’s auto lobby, of which Stellantis is a member, the consultancy estimates France risks losing nearly a third of its automotive jobs by the end of the decade. The grim forecast could be applied to other countries, especially in Europe, Marian said.
Coders needed
While Stellantis and other legacy carmakers have plans to retrain staff and hire software specialists to develop self-driving and digital features for their future models, not every mechanic will be able to code.
“Shrinking workforces remains a challenge across the industry,” Citigroup analyst Gabriel Adler wrote in a report. The average age of industry employees in Europe is between 40 and 45 years old and workers are predominantly focused on conventional motors, he said.
At Stellantis, the drive to get people out the door is accelerating in France, where the company employs about 45,000 people and commands 34 percent of the market mostly through sales of Peugeots and Citroens. In Italy, the birthplace of brands including Fiat and Alfa Romeo, Stellantis has reached a number of so-called performance accords with unions. With 50,800 workers, Stellantis is also offering incentives for voluntary departures.
Stellantis began talks with French unions Feb. 1 on a two-year plan for 2,600 voluntary job cuts. Union leaders forecast the downsizing will continue at least at the same pace through 2025. When early departures of more senior staff are included the numbers could reach as many as 8,000. In addition, they predict, as many as 2,100 workers could leave to work at joint ventures in northern France: Automotive Cells Company for batteries, and the Emotors and e-Transmissions businesses. The Stellantis spokesman dismissed the union estimates as “false.”
