France wants Renault security on jobs and factories

A merger between Fiat and Renault must include guarantees on French jobs and factories and fit with an existing Franco-Japanese car partnership, according to France finance minister Bruno Le Maire.

France wants Renault security on jobs and factories

A merger between Fiat and Renault must include guarantees on French jobs and factories and fit with an existing Franco-Japanese car partnership, according to France finance minister Bruno Le Maire.

The French government wants safeguards on maintaining industrial jobs in France and “zero” site closures, he said. Renault chairman Jean-Dominique Senard, who is leading merger talks, “has to come back to me on the guarantees he has obtained from Fiat on Renault’s footprint in France”.

Fiat this week proposed to merge with Renault to create the world’s third-biggest carmaker. The French company’s board agreed to study what it called a “friendly” proposal, structured as a 50-50 ownership through a Dutch holding company.

In his first public comments on the deal, Mr Le Maire said it represented a “great opportunity” for Renault and the European car industry.

Yet, he laid out four demands that need to be fulfilled before what he termed the merger of equals could be approved. The French government is Renault’s most powerful shareholder and has representatives on the board.

In addition to providing job guarantees and including Renault’s partners, Nissan and Mitsubishi Motors, in the equation, Mr Le Maire said he wants assurances on who will head the new entity “so that French interests will be well preserved”.

In defending the deal, the French government is opening itself up to criticism from unions and the political opposition for giving up a degree of control over Renault. The state’s holding will be halved to 7.5% under the plan, a significant decline in light of France’s history of intervening in companies in which it holds significant stakes. Jobs will be saved through investment in new technology like electric and self-driving cars, rather than through government equity holdings, Mr Le Maire said. In Italy, Matteo Salvini, the deputy prime minister, has also indicated support for the deal, so long as jobs are safeguarded.

One big question is how a combined Fiat-Renault would mesh with the French carmaker’s alliance with Nissan and Mitsubishi. Relations between the partners were rocked by the November arrest in Japan of former alliance Chairman Carlos Ghosn on allegations of financial crimes — charges he denies.

Reuters

More in this section

Lunchtime News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up
Revoiced
Newsletter

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up