Renault aims to cut 7,500 posts in France

Tue Jan 15, 2013 12:29pm EST
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By Gilles Guillaume

PARIS (Reuters) - French carmaker Renault (RENA.PA: Quote) is aiming to cut 7,500 jobs on its home patch by 2016 to help boost competitiveness as the slump in its domestic and European markets shows no sign of easing.

The job cuts, which are equivalent to 14 percent of Renault's French staff, will be a further blow to President Francois Hollande, who has made creating employment his priority for this year as the jobless rate reaches 13-year highs.

Renault is pushing workers to accept a new nationwide deal on pay and conditions to cut costs and align productivity with cheaper European sites such as its Palencia plant in Spain and alliance partner Nissan's Sunderland factory in England.

The company hopes about three-quarters of the cuts will be achieved through normal staff turnover, a Renault spokeswoman said on Tuesday following the latest in a series of meetings with unions.

Automakers across Europe are having to cut costs and capacity so they can still turn a profit while the euro zone debt crisis and resulting government austerity measures sap consumer demand. Car sales in France, Spain and Italy fell to their lowest levels in years in 2012.

Rival French carmaker PSA Peugeot Citroen (PEUP.PA: Quote) is struggling to reverse mounting losses by scrapping more than 10,000 domestic jobs and closing an assembly plant near the French capital.

Japanese carmaker Honda (7267.T: Quote) on Friday unveiled plans to cut around 800 jobs at its plant near Swindon in southwest England due to falling demand for its vehicles across mainland Europe.

OVERCAPACITY   Continued...