EU to quiz France over pressure on Renault

15th January 2010, Comments 0 comments

EU Competition Commissioner Neelie Kroes said she had instructed her office to contact the French authorities to seek explanations after they sought to pressure Renault not to shut down factories at home.

Brussels – The EU competition watchdog said Thursday it would seek explanations from France about its pressure to prevent car maker Renault from moving production of its Clio models to Turkey.

EU Competition Commissioner Neelie Kroes said she had instructed her office to contact the French authorities to seek explanations after they sought to pressure Renault not to shut down factories at home.

"I have consistently taken a tough line against knee-jerk protectionism. Economic nationalism risks setting off a spiral of retaliation that would make the crisis 10 times worse and destroy any chance of recovery," said Kroes.

She spoke of an "apparent contradiction" between comments made by French Industry Minister Christian Estrosi and promises made by Paris early in 2009 that subsidised loans to national car producers would not affect their freedom to move their operations.

The assurances received in February 2009 by French Secretary of State for Industry Luc Chatel included that any French aid "would not impose any conditions on the location of their production facilities," Kroes stressed.

On Wednesday, Renault announced plans to shut down production of its Clio model in Spain and Slovenia but said the car would still be made in France.

Renault has come under heavy pressure from the French government to keep jobs at home following press reports of a planned shift of Clio production from France to Turkey.

Estrosi said he was not in favour of Clio production shifting to Turkey.

After meeting with Renault executives he said: "It seems our message has been heard."

French government measures taken in 2009 to support the auto sector in the economic downturn included generous loans to car makers on condition that they keep production and jobs in France.

"We're not giving all that money to support the auto sector so that all our factories can leave to go abroad," President Nicolas Sarkozy told members of parliament at an Elysee meeting on Wednesday.

"I strongly contest the idea that these big companies, just because they are global, no longer have a nationality."

AFP / Expatica

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