Renault seeks to restructure French factories to slash costs

Workers attend the general assembly of strikers in a workshop of the former Renault factory on the Ile Seguin near Paris in April 1953. (AFP)
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Updated 30 May 2020

Renault seeks to restructure French factories to slash costs

  • Company in talks with unions over plans amid fears of public backlash over jobs

PARIS: Renault said on Friday it was launching talks with unions to restructure several French car plants, potentially leading to closures, as it confirmed plans to cut around 15,000 jobs worldwide.

Faced with a slump in demand exacerbated by the coronavirus crisis, Renault is aiming to find €2 billion ($2.22 billion) in savings over the next three years as it hones in on key car models.

“We thought too big in terms of sales,” interim chief executive Clotilde Delbos told a conference call, adding the firm was “coming back to its bases” after investing too much in recent years.

The company plans to trim its global production capacity to 3.3 million vehicles in 2024 from 4 million now, focusing on areas such as small vans or electric cars as it freezing manufacturing expansion in countries such as Romania.

The company — due to bring ex-Volkswagen executive Luca de Meo on board as CEO in July — said it would also slash costs by cutting the number of subcontractors in areas such as engineering, reducing the number of components it uses and shrinking gearbox manufacturing worldwide.

It hopes to find additional savings by producing more cars jointly with its Japanese partner Nissan, which has also outlined a plan to become smaller and more efficient.

Renault said the restructuring measures, which include job cuts and employment transfers that would affect just under 10 percent of its global workforce, would cost €1.2 billion.

FASTFACT

15%

Renault is 15 percent owned by the French state.

The group, which is 15 percent owned by the French state, said some plants such as the one in Flins, close to Paris, where it makes its electric Zoe models, could cease to assemble cars and center 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 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.


Tanker off UAE sought by US over Iran sanctions ‘hijacked’

Updated 16 July 2020

Tanker off UAE sought by US over Iran sanctions ‘hijacked’

  • The circumstances of the hijack are still unclear and the boat has been tracked to Iranian waters

DUBAI: An oil tanker sought by the US over allegedly circumventing sanctions on Iran was hijacked on July 5 off the coast of the UAE, a seafarers organization said Wednesday.

Satellite photos showed the vessel in Iranian waters on Tuesday and two of its sailors remained in the Iranian capital.

It wasn’t immediately clear what happened aboard the Dominica-flagged MT Gulf Sky, though its reported hijacking comes after months of tensions between Iran and the US

David Hammond, the CEO of the United Kingdom-based group Human Rights at Sea, said he took a witness statement from the captain of the MT Gulf Sky, confirming the ship had been hijacked.

Hammond said that 26 of the Indian sailors on board had made it back to India, while two remained in Tehran, without elaborating.

“We are delighted to hear that the crew are safe and well, which has been our fundamental concern from the outset,” Hammond told The Associated Press.

Hammond said that he had no other details about the vessel.

TankerTrackers.com, a website tracking the oil trade at sea, said it saw the vessel in satellite photos on Tuesday in Iranian waters off Hormuz Island. 

Hormuz Island, near the port city of Bandar Abbas, is some 190 kilometers (120 miles) north of Khorfakkan, a city on the eastern coast of the United Arab Emirates where the vessel had been for months.

The Emirati government, the US Embassy in Abu Dhabi and the US Navy’s Bahrain-based 5th Fleet did not respond to requests for comment. Iranian state media did not immediately report on the vessel and Iran’s mission to the United Nations did not immediately respond to a request for comment.

In May, the US Justice Department filed criminal charges against two Iranians, accusing them of trying to launder some $12 million to purchase the tanker, at that time named the MT Nautica, through a series of front companies. 

The vessel then took on Iranian oil from Kharg Island to sell abroad, the US government said.

Court documents allege the scheme involved the Quds Force of Iran’s paramilitary Revolutionary Guard, which is its elite expeditionary unit, as well as Iran’s national oil and tanker companies. The two men charged, one of whom also has an Iraqi passport, remain at large.

“Because a US bank froze the funds related to the sale of the vessel, the seller never received payment,” the Justice Department said. “As a result, the seller instituted a civil action in the UAE to recover the vessel.”

That civil action was believed to be still pending, raising questions of how the tanker sailed away from the Emirates after being seized by authorities there.

Data from the MT Gulf Sky’s Automatic Identification System tracker shows it had been turned off around 4:30 a.m. on July 5, according to ship-tracking website MarineTraffic.com. Ships are supposed to keep their AIS trackers on, but Iranian vessels routinely turn theirs off to mask their movements.

Meanwhile, the 28 Indian sailors on board the vessel found themselves stuck on board without pay for months, according to the International Labor Organization. It filed a report saying the vessel and its sailors had been abandoned by its owners since March off Khorfakkan. The ILO did not respond to a request for comment.

As tensions between Iran and the US heated up last year, tankers plying the waters of the Mideast became targets, particularly near the crucial Strait of Hormuz, the Arabian Gulf’s narrow mouth through which 20 percent of all oil passes. Suspected limpet mine attacks the US blamed on Iran targeted several tankers. Iran denied being involved, though it did seize several tankers.