Relocating certain productions is one of the conditions set by the government for obtaining a loan of 5 billion euros for Renault. Relocations in the automotive sector are also at the heart of the recovery debate in the sector today.
But for Louis Schweitzer, former boss of Renault (from 1992 to 2005 and still honorary president), relocating factories should not be the priority. “We have to take a look at the past. In 2005, when I left Renault, we built 1.3 million cars in France. In 2018, we manufactured less than 700,000. In other words, production in France was divided almost by two during the Ghosn period “, he explains on BFM Business.
Stop the bleeding
“And what we have to do now is to stop the bleeding first and that I believe is entirely possible. (…) Of course wages are a little more expensive than elsewhere but not more expensive than in Germany which is the first European automobile industry “, he underlines.
“Secondly France is well located in Europe and logistics is fundamental. So what is important to me is to stop the bleeding and (…) if we load the French factories well, it does not it is not a question of creating new factories but there is what to increase up to 900,000 or 1 million the production of Renault in France “, adds Louis Schweitzer.
And to explain: “in Renault’s recovery plan, there is the capacity to increase production in France whereas for 15 years it has decreased every year”. While specifying that this increase must concern “mid-range cars”. “The assembly labor costs are not decisive if we have productive, automated factories and taking into account the advantage of geographic” location.
Still, Louis Schweitzer welcomes the manufacturer’s recovery plan. “Usually, the first contributor is always the suppliers who make half or two-thirds of the savings (…) and there in the recovery plan everything comes from Renault itself. That is to say that Renault has perfectly understood that it is not by bumping into subcontractors that it will turn around the business and secure the industrial future of France. ”