French auto giant PSA Peugeot Citroen issued a statement Thursday that it plans to cut 8,000 jobs jobs in its domestic division because of earning losses earlier this year and its dismal outlook on the shrinking market.

Unions opposing the job cuts are reported to be planning protests later Thursday.

France's largest auto maker says it loss $860 million the first half of 2012, in a market that has fallen more 20 percent in the past five years.

PSA Chairman of the Managing Board, Philippe Varin, says in the statement, ” The depth and persistence of the crisis impacting our business in Europe have now made this reorganization project indispensable to align our production capacity with foreseeable markets”

The company's reorganization calls for the elimination of 3,600 jobs company wide in an effort to cut cost and improve efficiency.

The automaker also says it will end small car production in 2014 at its Aulnay site outside Paris which has 3,000 workers, shifting all production to its Poissy plant

In addition, PSA says it will redeploy 1,400 workers from its Rennes plant, which makes the Peugeot 508 and Citroen C5 and C6.

The company hopes its reorganization and partnership with General Motors will improve its future earnings.