Tuesday, June 2, 2020

EU carmakers worry as France warns Renault could disappear

International Business

Employees, wearing protective face masks, work on the automobile assembly line of Renault ZOE cars at the Renault automobile factory in Flins. REUTERS file photo

PARIS: Europe’s car industry was put on alert for more job losses yesterday as a French minister warned Renault could disappear if it didn’t get help soon and a Japanese news report said partner Nissan was considering 20,000 layoffs, with many in Europe.

Renault and Nissan have been in a carmaking alliance for the past two decades and are due to announce a strategy update next Wednesday.

The plan was originally billed as a reset of their relationship, which was rocked by the November 2018 arrest in Japan of the alliance’s architect and long-time boss Carlos Ghosn on charges of financial misconduct, which he denies. However, the update has taken on greater significance since the coronavirus pandemic hammered demand for vehicles and threw production into disarray.

French finance minister Bruno Le Maire, who is considering a $5.5 billion loan for Renault to help it through the crisis, warned yesterday the company’s future was at stake. “Yes, Renault could disappear,” he told Europe 1 radio.

Le Maire said Renault’s French plant in Flins mustn’t close and the company should be able to keep as many jobs as possible in France, but also said it needed to adapt and be competitive.

The Flins factory, northwest of Paris, is where Renault makes its electric Zoe models and the Micra car for Nissan. It employed around 2,640 people at the end of 2018, according to Renault’s website. The company has 40 plants and 13 logistics sites in 16 countries.

Kyodo said Nissan might axe 20,000 jobs from its global workforce, mainly in Europe and developing countries.

The carmaker said in July last year it would cut 12,500 employees, nearly 10 per cent of its of 140,000-strong workforce. If it raises that figure to 20,000, it would broadly match the number of jobs it shed during the 2009 global financial crisis.