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By Bloomberg

PSA Peugeot Citroen is considering shifting its headquarters away from a prestigious location near the Arc de Triomphe in Paris after 50 years as a cost-cutting push impacts executive ranks, people familiar with the matter said.

Most of the staff currently working at the site on the Avenue de le Grande Armee will leave Paris for a location in the suburb of Poissy, where Europe’s second-biggest carmaker has a factory, said the people, who asked not to be identified because the talks are private.

Chief Executive Officer Carlos Tavares presented the plan at a meeting of Peugeot’s supervisory board yesterday, and unions will discuss the proposal in January, the people said. If approved, the move would take place progressively and be completed by the end of 2016.

“We’ve launched a study to evaluate several options to better manage our real estate assets and improve the working conditions of our employees” at the headquarters, said Jean- Baptiste Thomas, a Peugeot spokesman. “No decision has been made yet.”

The manufacturer, which posted a first-half profit for the first time in three years, is working to restore earnings after selling shares to the French government and China’s Dongfeng Motor Corp. to raise cash. Peugeot already sold the headquarters building for 245.5 million euros ($306 million) in 2012. At the time, Peugeot said it planned to lease back the facility for at least nine years.

The office, located about 700 meters (765 yards) from the Arc de Triomphe, provides space for about 1,500 employees, who perform functions including administration and finance, according to an internal document obtained by Bloomberg. It costs about 50 million euros a year in rent and operating expenses, according to one person.

For about 500 employees who won’t go to the site in Poissy, a new headquarters would be found in the Paris region, one person said.