French government confirms 5 billion euro loan for Renault, with conditions

French car manufacturer Renault on Tuesday secured a government loan of 5 billion euros, to deal with the global slow down in the automobile industry and the crisis brought on by Covid-19. The company announced last week it would need to cut 15,000 jobs globally, nearly a third of them in France.

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However, after a series of difficult negotiations with managers and trade unions, Renault has agreed, in exchange for the loan, to restructure its factories.

During a visit to Etaples (Pas-de-Calais) last week French President Emmanuel Macron had already told Renault employees of the Maubeuge and Douai factories that "their future was guaranteed."

This in the face of a major company overall announced by Renault last Friday, which said due to the slowdown in the automobile market, they would need to cut 15,000 jobs globally, 4,600 in France.

The French state has 15 percent of shares of the Groupe Renault, which employs some 48,000 people in France.

The President's promise was confirmed on Tuesday afternoon by France's Economy Minister Bruno Le Maire, who announced a state guaranteed loan of 5 billion euros to bail out Renault following a meeting with leaders and trade union representatives in Paris.

Jobs guaranteed in Maubeuge

The reassurance of a loan was good news in particular for the factory in Maubeuge, in the north of France, which had been striking against the proposed merger with another site in Douai, some 70 kilometres away.

"We have a guarantee of keeping 2,100 employees on the site until 2023, and even beyond that date," Jérôme Delvaux, secretary of the CGT-MCA union, present at the meeting told France Televisions.

However, other workers at the Choisy-le-Roi factory outside of Paris, are on strike over the fact that their factory is the only one out of 14 still threatened with closure and facing a merger with another site.

Renault workers from different plants came out in large numbers to protest against the job cuts proposed by the company last Friday.

Unions said 8,000 people took part in the protest over the cuts designed to help Renault steer out of a cash crunch exacerbated by the coronavirus pandemic, 29 May 2020 AFP

Secretary of State for the economy Agnès Pannier-Runacher told France Inter radio on Wednesday that under the new deal, Renault would not fire its employees, but instead would integrate them elsewhere into the company.

"We've taken our responsibilities," she said, "now Renault has to come up with a plan that will not see workers laid off, and support the sites which are most competitive."

She went on to give Maubeuge as one of the more competitive sites in France, adding that the government believed it has a bright future and should be saved.

Worst crisis ever faced by Renault

"What we're doing is accompanying Renault in one of the worst crises that it has ever faced," she explained.

"For that, they will need to accept some restructuring. Job positions will be lost, but not people. Staff are not going to find themselves unemployed from one day to the next."

Renault president Jean-Dominique Sénard has indicated however that despite the government bailout loan, 4,000 jobs would still have to go in France by 2023.

He emphasised that the restructuring plan was already underway before Covid-19, and that crisis simply sped the process up.

"This is good news, the state supports us and I'm very grateful," he told France Info on Tuesday.

Projects in Morocco, Romania and China stopped

"If we use this loan, it will be reimbursed entirely by Renault. We will make it our objective that not one single euro from taxpayers will be used for Renault."

He said there was no question of sudden job loss, nor of lowering salaries to cope with the crisis, but staff would probably have to work a bit extra in the coming months to make up for the lost time during lockdown.

Elsewhere, Sénard said that Renault has stopped the development of sites in Morocco and Romania, had repatriated activities in Turkey and Slovenia and stopped a project to build electric motors in China.

 

Source: http://www.rfi.fr/en/business/20200604-french-government-confirms-5-billion-euro-loan-for-renault-conditions-economy-business-car-industry-coronavirus

 

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