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Renault to cut 7,500 jobs in France

Renault has confirmed it will have to cut approximately 7,500 jobs in France before 2016 as it adjusts its business following a fall in sales across Europe.

A deal still has to be agreed with unions. If a deal can be made, it will mean a 14% reduction of Renault’s French workforce through what it calls “natural wastage” and an early retirement programme.

Renault is hoping the plans will help it to avoid closing plants or a voluntary redundancy programme.

The brand has been rightsizing in the UK since it announced a product and dealer cull in February last year.

AM will be publishing its analysis piece on Renault’s prospects for the UK in the February issue of the magazine. Register to receive AM here.

Analyst view

Ana Nicholls, automotive analyst for The Economist's intelligence unit, said: "Renault's announcement comes on the same day that the European Automobile Manufacturers' Association confirmed that EU car sales fell by 8.2% in 2012, to reach their lowest level since 1995, with registrations in Renault's home market of France down by 13.9%.

"The Economist Intelligence Unit expects 2013 to bring little, if any, recovery before the market returns to growth in 2014, and even then sales will remain below pre-2008 levels.

“Given that the European car industry was already struggling with overcapacity before 2008, it is little wonder that Renault is joining its French rival PSA Peugeot Citroen as well as others such as Ford, General Motors and Fiat in cutting jobs and even (in some cases) closing plants altogether. The French government, which has spent heavily to support the car industry during the past few years, has seemingly accepted the inevitable.

“At the same time, though, Renault is investing in capacity elsewhere, including Russia (where it recently upped its stake in carmaker AvtoVAZ) and China. After all, while mature markets like the EU are shrinking, the EIU calculates that the global car market grew by over 6% in 2012, led by these fast-growing emerging markets."

 



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Comments

  • Irishboy4 - 17/01/2013 11:50

    A sign of the times, Renault, Peugeot, Citroen are all badges that are non aspirational. The yuppies prefer South African produced cars such as the Mercedes C Class, it is thirstier, ugly, slower and old fashioned rear wheel driven compared to a lovely Laguna, but shallow people want a star in front of their steering wheel.

    • craig renault service manager - 04/02/2013 20:39

      @never seen a lovely laguna many broken ones though