Renault under pressure over offshoring plans

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PARIS (AP) — French carmaker Renault SA came under mounting government pressure Wednesday to keep production of the next generation of its popular Clio small cars in France.

Renault is studying the possibility of dividing production of the Clio 4 between plants in France and Turkey.

“We are not putting in all this money to support our carmakers so that the totality of the factories go abroad,” French President Nicolas Sarkozy said.

Industry Minister Christian Estrosi said he had informed Renault Chief Operating Officer Patrick Pelata during a meeting Wednesday that the government, which owns 15 percent of Renault, would oppose any shift of Clio production out of France.

Renault currently makes different versions of the Clio in France, Turkey, Spain and Slovenia, but it is considering stopping production in Spain and Slovenia sometime around 2013.

“I made Mr. Pelata understand clearly, in a perfectly polite way, that we are not in favor of the future Clio 4 being produced abroad, at least the part of production destined for the French market,” Estrosi told reporters following the meeting.

“We can’t just stand by with our hands in our pockets” and watch Renault shift production abroad, Estrosi said, citing the billions of euros (dollars) that the French government provided both Renault and rival PSA Peugeot Citroen to prop them up during the global financial crisis, as well as the hundreds of millions of euros the government spent on a scrapping scheme to boost demand for their cars.

To hammer home the point, Renault boss Carlos Ghosn also has been asked to meet in the coming days with Sarkozy.

Sarkozy, speaking to lawmakers Wednesday, said he disagreed with the idea that large global companies “no longer have a nationality.” He did not specifically name Renault, but was speaking just hours after Estrosi met Pelata.

On his way out of that meeting, Pelata told reporters that “no decision has been made” on where Renault will build the Clio 4, the next generation of its Clio range, due to be launched in 2013.

Pelata said Renault was studying “different scenarios” on how to divide up production of the Clio and its replacement between a plant in France and one in Turkey.

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Associated Press writer Verena Von Derschau in Paris contributed to this report.

Tags : corporate capital corporate news eu france industries nicolas sarkozy politics
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