Auchan plans major redundancy plan threatening 2,300 jobs in France

Food retailer Auchan, part of the Mulliez group, is planning to present staff representatives with a large-scale restructuring project. Some 2,300 jobs could be affected in France, according to information from sources close to the company, relayed by AFP and confirmed by BFM Business.

The social and economic committees (CSE) of several of the group’s entities, convened this Tuesday at 9 a.m. in the Lille region, are expected to discuss Auchan’s current situation and outlook. The unions are concerned about the meeting, and fear that it will result in difficult announcements for employees, particularly in terms of employment.

Restructuring of head office and store staff

This restructuring project could affect various functions within the company, which employs around 54,000 people in France. According to internal sources, support functions at head office and certain store positions will be particularly affected. This is not the first downsizing for Auchan: in 2020, the company had already cut 1,475 positions, following a voluntary redundancy plan initiated at the beginning of the year for more than 500 positions.

A model under financial pressure

Despite its position as one of France’s leading retailers, Auchan is experiencing financial difficulties. Its holding company, Elo, recently reported a net loss of nearly one billion euros. Its holding company, Elo, recently reported a net loss of almost one billion euros for the first six months of 2024, following a loss of 379 million euros in 2023. While inflation has bolstered the sales of several competitors, Auchan’s results have remained in decline, a trend that has prompted the company to reposition itself.

Sharing strategies and downsizing sales areas

Faced with increased competition, Auchan has joined forces with Intermarché and Casino to pool its food purchases, an unprecedented ten-year agreement. At the same time, management plans to reduce the sales area of its hypermarkets in Europe by around a third, i.e. an average reduction of 25% in each of its markets. However, these strategic choices are causing concern among trade unions, who are worried about the implications for employees.

As the fifth largest retailer in the French market, with a 9% share behind giants such as E.Leclerc, Carrefour and Intermarché, Auchan is seeking to adapt in order to survive a mass retail model in the throes of transformation.