The gloom surrounding the global car industry deepened today as major companies across Europe and Asia announced production cuts and job losses.

In France, PSA Peugeot Citroën said it was seeking to shed 3,550 jobs through voluntary redundancies. It aims to axe 2,700 white-collar posts across France, and 850 factory positions at its plant in Rennes.

The carmaker issued a bleak forecast for 2009. It said the impact of the financial crisis on the industry meant that sales in the key European markets would fall by at least 10 per cent in 2009, and 17 per cent in the fourth quarter.

In a statement, Jean-Luc Vergne, human resources director at PSA Peugeot Citroën, said that the future of the company and its 200,000 jobs could be in jeopardy if it did not take action now.

General Motors (GM) said it would close its plant in Thailand, south east of Bangkok, for two months from mid-December and cut 258 jobs.

While the plant produces only a slim proportion of GM's 9.28 million global output - about 100,000 vehicles for south-east Asia and Australia in 2007 - the move is the latest indication of the difficulties facing the industry.

Sluggish demand has also prompted the fortnight-long closure of its South Korean unit, announced last week.

GM has joined Ford and Chrysler in appealing to the US Government for access to the $700 billion bailout.

Despite rapid growth in the industry in recent years, Japan also continues to feel the impact of the slowdown. Earlier today, Mazda said it would not renew the contracts of about 70 per cent of its combined temporary work force at two local factories, meaning that 1,300 people will be out of work by the end of this year.

Shares in Mazda ended at Y163 on the Nikkei today, the lowest close in more than seven years.

Japan's carmakers are looking to their production sites in Thailand in their effort to drive down costs. Toyota, Japan's leading carmaker and the top brand in Thailand, announced plans to cut production at its plant in the country, which produces 200,000 vehicles a year. It also hopes 340 jobs among its temporary workforce through early retirement.

Isuzu, the second-leading brand in Thailand, said it was constantly working to ensure production levels tallied with sales, but had no immediate plans for cuts to the workforce.

Honda said it had no plans to cut production or staff in Thailand, where it has two plants.

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