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French aid prompts Renault move | French aid prompts Renault move |
(10 minutes later) | |
French carmaker Renault is to shift some car production back to France after the guarantee of state aid. | French carmaker Renault is to shift some car production back to France after the guarantee of state aid. |
The company will bring one car production line to the Paris suburbs from Slovenia and create 400 jobs, a French government minister said. | The company will bring one car production line to the Paris suburbs from Slovenia and create 400 jobs, a French government minister said. |
But the European Commission has demanded clarification about the plan, saying it may be protectionist. | But the European Commission has demanded clarification about the plan, saying it may be protectionist. |
France last month agreed to give Renault and Peugeot Citroen loans in return for keeping French plants open. | France last month agreed to give Renault and Peugeot Citroen loans in return for keeping French plants open. |
Luc Chatel, a junior minister for industry, announced Renault's decision in a local radio interview. | Luc Chatel, a junior minister for industry, announced Renault's decision in a local radio interview. |
European concerns | European concerns |
A spokesman for the EU competition commissioner told the BBC that the announcement appeared to be in contradiction with the minister's previous pledges not to link the state bailout to the protection of jobs in France. | A spokesman for the EU competition commissioner told the BBC that the announcement appeared to be in contradiction with the minister's previous pledges not to link the state bailout to the protection of jobs in France. |
The spokesman said the Commission would be sending urgent letter to the French authorities. | The spokesman said the Commission would be sending urgent letter to the French authorities. |
A Renault spokeswoman told the BBC that no jobs would be lost in Slovenia when production is moved to the Flins factory, near Paris. | A Renault spokeswoman told the BBC that no jobs would be lost in Slovenia when production is moved to the Flins factory, near Paris. |
The French plan to offer both Renault and Peugeot Citroen 3bn euros ($4bn; £2.8bn) sparked a row over protectionism after President Nicolas Sarkozy suggested that the money shouldn't be used to rescue French-owned factories in Eastern Europe. | |
Carmakers in Europe and beyond have been hit hard by the economic downturn. | Carmakers in Europe and beyond have been hit hard by the economic downturn. |
Renault last month reported a steep fall in profits and abandoned its targets for 2009, blaming an economic crisis "of massive proportions". Sales in Europe were down more than 7%, it said. | Renault last month reported a steep fall in profits and abandoned its targets for 2009, blaming an economic crisis "of massive proportions". Sales in Europe were down more than 7%, it said. |