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France says Fiat-Renault merger must protect jobs

May 28, 2019

Local factories must stay open as part of a proposed merger between the French and Italian automakers, insists France's finance minister. If accepted, the deal would create one of the world's biggest auto empires.

French Finance Minister Bruno Le Maire
Image: picture-alliance/TT/N.H. Jåma

French Finance Minister Bruno Le Maire insisted on Tuesday that local French jobs must be protected in the event of a merger between French carmaker Renault and Italy's Fiat Chrysler Automobiles (FCA). The French government has a 15% stake in French company Renault, which is closely tied to Japanese manufacturers Nissan and Mitsubishi.

French demands 

Le Maire told RTL radio that he wanted four guarantees regarding the potential merger:

  • French workers and factories must be protected
  • Any merger must should not affect Renault's alliance with Nissan and Mitsubishi
  • That "French interests will be represented" on the board of the new organization
  • The new company must commit to developing electric batteries in Europe

Le Maire added that if a deal was secured, France's stake in Renault would not change, meaning the French share of a new entity would be roughly halved.

Market share

FCA initiated the talks with Renault with a view to combining the two companies. Renault welcomed the proposal on Monday and, following an initial meeting, said its board would study it "with interest" and give its response "in due course."

The combined group would forge the world's third-biggest automaker, making some 8.7 million vehicles a year and trailing only Volkswagen and Toyota.

Italy's government has been positive towards the plan, with Deputy Prime Minister Matteo Salvini calling it a "brilliant deal."

FCA said the merger would not lead to any production sites closing down but didn't make as specific a pledge regarding jobs. 

Read more: Do Fiat Chrysler and Renault make a good fit?

kw/msh (AP, AFP) 

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