Showdown at Peugeot plant as strike splits workers

AULNAY-SOUS-BOIS, France (Reuters) - For workers on the assembly line at Peugeot's doomed Aulnay plant near Paris, starting their shift has become a daily test of nerves.

Entering a factory that is set to close in 2014, they face jeers and threats, as well as eggs and other objects hurled by striking colleagues protesting against the shutdown and Peugeot's restructuring plans.

The two-week-old standoff between union pickets and the workers they brand as scabs highlights the latest deterioration in labor relations as France's biggest carmaker seeks to cut production capacity amid a slump in European sales.

It may only be a foretaste of more clashes to come as unions steeped in a culture of conflict fight restructuring plans by Peugeot and Renault , as both struggle to compete against high-quality German rivals and low-cost Asian players.

"Before coming in, I call a friend to test the water," one 35-year-old assembly line worker, who asked to be interviewed in an isolated office and who had taped over his name tag.

"Are things tense? Are they wound up? These days, it's better to be cautious."

Two weeks after the militant CGT union called a strike against Peugeot's plans to cut 8,000 job cuts across France, Aulnay is the front-line of an increasingly tense showdown between management, the strikers and non-striking unions.

Out of a total 3,000 workers, management says only 260 are striking, while the CGT puts that figure at up to 500. Absenteeism has doubled during the dispute, meaning that several hundred more are off sick at any given time.

Production -- a total 120,000 cars last year -- is at a standstill at the sprawling facility 15 km (10 miles) north of Paris in a suburb largely inhabited by the descendants of immigrants from France's North African former colonies.

Peugeot management is attempting to maintain some degree of activity by bussing in temporary workers or staffers from other sites through the picket lines.

Dozens of black-clad guards stand at the factory gates to oversee shift changes and management have cleared a parking lot that normally holds new cars to preempt any damage to inventory.

In a twist on the traditional dispute where strikers tend to remain outside the factory, at Aulnay many of them also roam around inside the factory grounds, from which the company is not allowed to bar them if they do not interfere with operations.

On the day that Reuters visited, around 70 strikers had gathered inside the factory grounds. Speakers blasted North African music and Arabic chants as some played soccer and others honked the horns of utility vehicles. Now and then, jeers at outsiders pierced an otherwise almost festive atmosphere.

Across from the strikers, some thirty foremen from other sites stood in silence. Brought in to work, they in fact serve to keep watch on the strikers and prevent attacks on the machinery, a PSA spokeswoman said.

The few non-striking workers visible must navigate a no-man's land strewn with the remains of hurled eggs, under the jeers of strikers. Two workers said they had seen strikers throw bolts, which on-site CGT leader Jean-Pierre Mercier denied.

"The situation has become almost impossible here," said Anne-Laure Descleves, a spokeswoman for Peugeot at Aulnay.

INTIMIDATION OR "PURE CINEMA"?

Peugeot says that Aulnay's workers have been given fair options for the future: half will be transferred to other sites at equal pay, and the rest are to be offered positions at other companies moving into Aulnay.

As conditions deteriorate, the firm won support on Tuesday from three of five unions at Aulnay to speed up its wind-down and start transferring workers to the Poissy plant west of Paris, which assembles the same C3 model.

But CGT and the SUD union said the transfers were illegal because workers had received no guarantees about their positions at other sites. Their demands include early retirement for older workers, better conditions for transfers, and job guarantees.

But Peugeot executives say dialogue with the hardliners has been impossible ever since the early 1980s when the CGT, whose roots go back to the French Communist Party, made inroads into Aulnay.

"What we are dealing with is a group of Trotskyist workers whose aim is to overthrow the system, to cause revolution," said Descleves. "I don't believe they are genuinely interested in negotiations."

Dismissing reports of union splits, sabotage and threats as the result of a pro-management smear campaign, the CGT insists the only way of getting concessions is to maintain pressure on Peugeot.

They deny any conflict with other unions, except the centre-left SIA, who are described as turncoats.

"The tensions, the clashes, the so-called intimidation of non-strikers - all that is pure cinema, invented by the bosses to make us look like thugs," Mercier told Reuters. "We are fighting for dignity and will continue until we can't anymore."

Yet other unions at Aulnay also criticize the CGT. Laurent Berger, national leader of the moderate CFDT, called its tactics at Aulnay and other sites "intolerable", while SIA delegation head Tanja Sussest told Reuters she was "at war" with the CGT.

Non-strikers accused the CGT of creating a climate of fear at the plant, approaching workers in groups to threaten them with violence if they showed up for work the next day.

"All I want is to be able to go to work," said the assembly line worker with the taped-up name badge.

"Most of the people here are serious, good workers, but there are also people who don't want to work," he said, adding that while he would prefer Peugeot to sweeten its offer to workers, he would accept a transfer to Poissy on equal pay.

(Editing by Lawrence Frost, Mark John and Giles Elgood)