France warns that Renault could disappear – Journal


PARIS: The European auto industry was warned of more job losses on Friday when a French minister warned that Renault could disappear if it did not get help quickly.

Renault and Nissan have been part of an automotive alliance for two decades and are expected to announce an update to their strategy next Wednesday.

The plan was originally presented as a reset of their relationship, which was shaken by the arrest in November 2018 in Japan of the architect and longtime boss of the alliance, Carlos Ghosn, for financial misconduct, which he denies.

However, the update has taken on greater significance since the coronavirus pandemic hammered demand for vehicles and plunged production into disarray.

French Finance Minister Bruno Le Maire, who is considering a 5 billion euro ($ 5.5 billion) loan to Renault to help it get through the crisis, warned Friday that the company’s future was at stake.

“Yes, Renault could disappear,” he said on Europe 1 radio.

The Mayor said that Renault’s French factory in Flins should not close and that the company should be able to keep as many jobs as possible in France, but also said that it should adapt and be competitive.

Renault declined to comment on the mayor’s remarks.

The Flins plant, northwest of Paris, is where Renault makes its Zoe electric models and the Micra car for Nissan. It employed around 2,640 people at the end of 2018, according to the Renault website.

The company has 40 factories and 13 logistics sites in 16 countries.

Kyodo, meanwhile, said Nissan could cut 20,000 jobs from its global workforce, mostly in Europe and the developing world.

Two people familiar with the matter told Reuters that the number of cuts has not been finalized.

Nissan declined to comment.

The Japanese automaker announced last July that it would cut 12,500 employees, or almost 10% of its 140,000 employees. If it increases that figure to 20,000, it will roughly match the number of jobs it cut during the 2009 global financial crisis.

Sources familiar with the matter told Reuters earlier this month that Nissan management believed it must be much smaller and that it would likely remove a million cars from its annual sales target, while seeing a greater role for the United States and China in car sales.

Sources have also announced plans to cut European operations to focus on utility and sport utility vehicles, including the closure of a factory in Spain, which employs around 3,000 people.

Struck by overcapacity, fierce competition and declining demand, the European auto industry has experienced a steady stream of job losses, with Volkswagen in Germany announcing up to 9,500 job cuts under its Audi brand in December.

So far, however, most of the layoffs during the coronavirus crisis have been temporary, with companies taking advantage of government-backed emergency leave schemes.

Posted in Dawn, May 23, 2020


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