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France guarantees credit to carmakers

France became the first country yesterday to provide credit guarantees to the financing arms of its carmakers.

Renault and Peugeot will share a payment of  £696m with a further £197m handed over to the carmakers before the end of January to support their consumer finance divisions, reports the Financial Times.

After meeting representatives of the manufacturers, French president Nicolas Sarkozy showed a willingness to help, notably in the shape of loans or guarantees.

However, President Sarkozy warned aid would be given only in return for a "firm undertaking"  by manufacturers and suppliers not to move production overseas.

 

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