French Carmaker Renault plans to axe 15,000 jobs worldwide as a $A3.3 Billion (2 billion euro) cost-reduction plan is announced.
Renault has announced that almost 15,000 jobs will be cut from its car manufacturing operation. In a statement on Friday the carmaker said 4600 jobs in France will be axed, with a further 10,000 jobs around the world also being cut.
“The difficulties encountered by the group, the major crisis facing the automotive industry and the urgency of the ecological transition are all imperatives that are driving the company to accelerate its transformation,” according to a statement.
The car group is revising its global production capacity from four million vehicles in 2019 to an estimated 3.3 million by 2024, the company stated.
“The planned changes are fundamental to ensure the sustainability of the company and its development over the long term”. Says Jean-Dominique Senard who is currently chairman of the board of directors for Renault.
The group also announced it plans to suspend the capacity increase projects in Morocco and Romania.
The group, Which has 180,000 employees around the world is also considering “adaptation” of its production capacities in Russia and will halt Renault-branded oil-powered car activities in China.
Renault has faced several bumpy roads, as recently as 2018 when their CEO Carlos Ghosn was arrested in Japan on allegations of financial misconduct including the misuse of company assets. Things didn’t get better a year later when in 2019 Renault reported its first losses.
With the companies largest shareholder being the French government which owns a share of 15 percent, talks of a loan guarantee totalling 5 billion euros could be on the table.
The Renault legacy, which was started in 1898 by brothers Louis, Marcel and Fernand Renault has fulfilled its mission for over 100 years, although Finance Minister Bruno Le Maire has said the group’s survival was at stake.