European Automotive Supplier body, CLEPA, says it is closely monitoring the situation at PSA Peugeot Citroen following the automaker's decision to drastically reduce headcount.

Many CLEPA members could potentially be affected by PSA's announcement it is looking to lay off up to 8,000 staff and close the C3-producing plant at Aulnay, just north east of Paris.

CLEPA is observing developments at the manufacturer from its headquarters in Brussels, with the new left-leaning government summoning several PSA unions to Paris this evening (17 July) in a bid to gauge initial reaction and to emphasise the unveiling of a French automotive support plan on 25 July.

"Obviously seeing an OEM in difficulty is not a good thing for CLEPA and we hope they find back their competitiveness very soon," the automotive supplier body CEO, Jean-Marc Gales, a former PSA board member, told just-auto from Munich. "Some of our members are very much dependent on these volumes.

PSA is looking to address the twin pressures of a current European downturn and significant over-capacity - problems currently faced by a significant number of auto manufacturers.

And Gales highlighted two imminent important dates for CLEPA before it comments further concerning the fall-out from PSA's major downsizing.

"The first date is 25 July when the French government wants to announce the support plan for the automotive industry and of course, that means for the suppliers as well, " he said.

"And also PSA wanted to announce in the next ten days more details [of the restructuring], so I would wait ten days before making an official CLEPA statement."

The CLEPA chief - while remaining realistic as to the European downturn - also cautioned against direct intervention in the French market such as revisiting the scrappage scheme - a solution put forward by some as a way of kick-starting moribund domestic sales.

"The French market and the European market are really in trouble and the new French government are fully aware," he said. "Pierre Moscovici [Finance Minister] and Arnaud Montebourg [Economic Regeneration Minister] are very smart people and do not want to give subsidies in the form of [a] scrappage scheme.

"This will reduce the level of pricing of [the] automotive industry for the next few years - you just pull forward demand at a lower price. We all agree a scrappage scheme is not enough so we are looking forward to the plans of the French government."