Hope and fear: Renault in crisis

As if the environmental regulations emerging in Europe weren’t tough enough on the automotive industry, the crisis caused by the corona crisis further endangers automakers.

Renault is one of the manufacturers struggling in this crisis. A French minister warned that Renault could disappear if it didn’t get help soon.

With the economy tanking, demand for personal vehicles has greatly decreased since the corona pandemic. Minister of finance Bruno Le Maire in France is considering a 5 billion euro loan for Renault. The loan should help the car maker through the crisis, but the minister also warned that the company’s future is in danger. According to Le Maire, Renault could disappear if no one intervenes.

Factories

Renault has a factory in Flins, in north France. As of 2018, the factory employs more than 2500 people, and it makes the electric Zoe models as well as Nissan’s Micra.

Worldwide, Renault has 40 factories in a total of 16 countries.

End of an era

Even though this crisis could mean the end of Renault, not all hope is lost. The company will have to make sacrifices, but a positive outcome is not ruled out. The French government will not hand out a 5 billion euro loan without setting some demands. One of the requirements will be that Renault brings some production back to France. Another demand might be related to manufacturing electric cars. This could improve Renaults position in the future market. In that sense this doesn’t have to be the end of Renault just yet, however it could be the end of Europe’s combustion engine.

Source: Reuters

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