French car maker Renault has announced nearly 15,000 job losses globally, including 4,600 in France in a two-billion-euro, three-year cost-cutting plan.
Earlier, French President Emmanuel Macron said that authorities intend to send 8 billion euros to support the automotive industry.
“This plan is essential,” CEO Clotilde Delbos said in a statement.
Renault doesn’t plan to force the dismissal of employees. The reduction of jobs will be carried out gradually through voluntary dismissal, or by retraining or transferring to other positions within the company.
Renault was in a difficult situation even before the coronavirus pandemic, but following the outbreak it was forced to close all its plants. The enterprise began to resume work in late April. Sales of new cars fell in April in Europe by 76.3%.
According to industry experts, 2019 was a difficult year for Renault – the company’s net loss, according to its annual financial report, exceeded 140 million euros.
Japanese partner Nissan, alongside which it hopes to find additional savings by producing more cars jointly, this week also outlined a plan to become smaller and more efficient.
Renault said the restructuring measures, including job cuts and employment transfers that would affect just under 10% of its global workforce, would cost 1.2 billion euros.
The group, which is 15% owned by the French state, said some plants like the one in Flins, close to Paris, where it makes its electric Zoe models, could cease to assemble cars and centre on recycling activities, instead.
Six sites in all, including a component factory in Brittany and the Dieppe factory where the group’s Alpine cars are made, will be under review.
Unions in France have said they feared the measures could lead four sites to shut, though outright closures are likely to lead to a public backlash.
The government has said it will not sign off on a planned 5 billion euro state loan for Renault until management and unions conclude talks over jobs and factories in France.
Renault was already under pressure when the coronavirus pandemic hit, posting its first loss in a decade in 2019. Like its peers, it is now trying to juggle a slump in revenue with industry-wide changes such as investment needed to produce more environmentally friendly vehicles.