PSA Peugeot Citroen union, CFE-CGC, says it has obtained a significant improvement in the minimum financial package for voluntary redundancies at the automaker.

PSA is planning to cut up to 8,000 staff and close its Aulnay plant near Paris, a move that was echoed last week by fellow-French automaker, Renault's, decision to axe around 7,500 jobs as both look to improve competitivity.

The CFE-CGC body says it is working to avoid any forced redundancies and also that for those wishing to leave, an increase in the minimum compensation of EUR30,000 (US$40,000) has been obtained.

Talks are also due to take place to discus compensation for the least well paid and the youngest employees, with negotiations scheduled for 29 January.

PSA Peugeot-Citroen said vehicle sales in 2012 were down 16.5% at slightly less than 3m units.

The company blamed the weak European car market and the cessation of completely knocked down (CKD) car shipments to Iran for the decline.