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PSA Peugeot Citroen, Europe's second-biggest carmaker, is the only foreign automaker which has so far said it would trim its headcount in China.

Factory employees work at the Benz-DaimlerChrysler plant in Beijing [Bloomberg News]

It has cut 1,000 temporary staff at its Chinese venture Dongfeng Peugeot Citroen last November after vehicle sales declined.

The venture, invested by PSA, China's Dongfeng Motor Group Co and other shareholders, previously had 9,000 people on its rolls.

Hui Yumei, auto analyst, Sinotrust, a leading automobile industry research company said the Dongfeng Peugeot Citroen layoffs is "necessary because of its ailing performance and really bad sales."

The venture sold 180,800 vehicles last year, down 12.7 percent compared with 2007, the second consecutive year sales fell.

The French automaker announced on Feb 11 that it would further axe 11,000 jobs globally, after the first round of 18,000 staff reductions.

The other major international auto companies, including Volkswagen, Nissan, Toyota and Honda all said they would not cut jobs in China although they have decided to trim workforce in other regions.

"Despite a global workforce reduction of 20,000 Nissan staff, Dongfeng Nissan is planning to increase its recruitment this year," said Toshiaki Otani, general manager, Dongfeng Nissan Passenger Vehicle Co.

General Motors, which is teetering on the verge of bankruptcy, has decided to cut 47,000 jobs globally in its restructuring plan submitted to the US government on Feb 17.

However, "the impact will vary with each region and country, reflecting the business conditions. So, in China we are working to determine how these changes will impact our own operations. We have done some preliminary work and expect the impact to be limited," General Motors China said in an emailed reply to China Daily.

"China is a strategic focus for GM and we need to remain aggressive to maintain our leadership position."

In January, GM, the biggest foreign automaker in China, sold 111,282 vehicles in the nation, up 3.3 percent year-on-year, while some of its rivals reported falling sales.

"If a company still needs to produce enough automobiles, how can it reduce the workforce?" said Hui. Compared with the sales fall in the US and Europe, analysts believe there would be a slight increase in China's automobile market this year.

In January, China has for the first time topped the US in auto sales, with 735,500 vehicles sold domestically. In contrast monthly sales in the US declined 37 percent in January to 656,693 vehicles.