SA Peugeot Citroen, Europe’s second-largest carmaker, plans to offer French workers incentives to take early retirement to trim costs and return to profit, according to a union official.

In talks with unions Friday, Peugeot proposed a bonus equivalent to 1.5 months salary to employees that either retire early of work part-time for lower pay, Franck Don, the leader of the CFTC union at the Paris-based company, said by phone.

The plan would be available to French workers at least 57 years old, which totals 5,600 people, Don said. Staff that work part-time would receive 70 percent of their gross salary for as long as 36 months and workers would keep full retirement benefits. Financing of the plan hasn’t yet been discussed. Peugeot representatives declined to comment.

Peugeot, which reported a 576 million-euro ($752 million) operating loss last year, has started to implement a restructuring plan that includes closing a factory on the outskirts of Paris and eliminating 11,200 positions in France. Peugeot’s home country accounted for 40 percent of the company’s production last year.

The manufacturer started talks with French unions on May 29 to reach a “social contract” with workers that would help the company increase productivity at its plants.

Peugeot employed 204,287 people at the end of last year, with 46 percent being based in France. About 27 percent of Peugeot’s automotive workers are at least 50 years old, according to company data. 

(Bloomberg)