Auchan wants to cut 2,389 jobs in France

In difficulty for several years, the distributor presented an unprecedented social plan. In detail, Auchan plans to eliminate 784 positions within its headquarters and 915 positions in stores.

The ax has fallen. Faced with its difficulties, the Auchan group presented a social plan this Tuesday which could lead to the elimination of 2,389 jobs in France. Unheard of for the group, long a flagship of the Mulliez galaxy.

These cuts will be made in particular through the closure of around ten stores, we learned from management on Tuesday.

In detail, Auchan, which employs around 54,000 people in France, plans to cut 784 positions within its headquarters and 915 positions in stores.

It provides for the cessation of direct home delivery activity which would result in 224 job cuts.

And it plans to close around ten unprofitable points of sale (466 positions eliminated), including three hypermarkets in Clermont-Ferrand Nord (Puy-de-Dôme), Woippy (Moselle) and Bar-le-Duc (Meuse), and in a supermarket, in Aurillac (Cantal).

At the same time, the group announces 319 job creations, including 205 in support functions which will be shared.

“Since 2012, Auchan has suffered a constant decline in store traffic and a deterioration in its results. Over the period, and before the integration of the Casino stores, its market share fell from 12.1% to 8%, its revenues fell by 2.26 billion euros, and its EBITDA was divided by 6. Faced with this observation and in an ultra-competitive context, Auchan must bounce back,” we can read in a press release.

The announcement was made to the unions during a CSE (social and economic committee) in the Lille region for an “update on the situation of the company and its projects”.

It must be said that the group has been experiencing difficulties for several years. First, Auchan's market share, at 9.1% at the last count, is far behind E.Leclerc (24.1%), Carrefour (21.4%), Mousquetaires/Intermarché (17.4%). and Cooperative U (12.2%), which leaves it less room for maneuver in its negotiations with agro-industrial suppliers.

To carry more weight, Auchan joined forces with its competitor Intermarché to buy together in an alliance lasting an unusually long 10 years.

A model out of breath

In addition, the group which owns its stores, with very few franchises, suffers from competition from E.Leclerc, Intermarché and Coopérative U.

These groupings of independent companies reduce operating costs as much as possible and social conditions are generally lower. This generally allows these stores to be able to sell their products at more competitive prices.

Another weak point for Auchan: the group has historically relied on the format of hypermarkets, the largest stores, but this is less popular today.

Over the first six months of 2024, its holding company Elo suffered a net loss of almost a billion euros. Last year, it suffered a net loss of 379 million euros with declining sales, while inflation had boosted the sales of most of its major retail competitors.

Since the collapse of the Saint-Etienne Casino group, where a PSE is also underway and could affect more than 3,000 jobs, Auchan is regularly cited as the worst-off in large-scale food distribution.