Sarkozy to grill Renault chiefs over Clio production in Turkey

Sarkozy has summoned Renault executive chairman Ghosn for a meeting over concerns that a new version of its popular Clio car could be made mainly in Turkey.

Sarkozy to grill Renault chiefs over Clio production in Turkey

President Nicolas Sarkozy has summoned Renault executive chairman Carlos Ghosn for a meeting over concerns that a new version of its popular Clio car could be made mainly in Turkey.

Industry Minister Christian Estrosi said the meeting would aim to find a new way forward for the carmaker and the state, which is a 15 percent shareholder in the group.

"I want to say very clearly ... that we would not be well disposed towards a decision to have the Clio 4 mainly produced in Turkey. Decisions will come from the meeting that meet the choices that the president of the republic, as a shareholder of the Renault group, will impose upon them," Estrosi said.

A source close to the matter said the meeting would take place on Saturday and involve Ghosn, Renault's chief operating officer Patrick Pelata, as well as Estrosi and presidential social affairs adviser Raymond Soubie.

The state could also appoint more members to Renault's non-executive board. There are 18 Renault board members including Ghosn, Danone head Franck Riboud and former Total Chief Executive Thierry Desmarest.

Estrosi spoke at a news conference after a meeting with executives from Renault, including Pelata. He added that Pelata had pledged not to cut jobs at Flins, the plant where an older model of the Clio is produced.

The current model of the Clio is mostly produced in factories outside France, including in Turkey. The debate now underway between Renault and the government is over where the next generation of Clios will be built.

The state has long sought to influence Renault's strategy to preserve domestic jobs. In recent years, Renault has moved production of many of its smaller models to countries where labour, taxes, and production costs are lower.

In February 2009, as a condition of a government aid package during the economic crisis, Renault pledged not to close factories in France for the duration of a 3 billion euro ($4.37 billion) low-interest loan.

Government spokesman Luc Chatel told reporters the meeting would take place "very soon" and said it was "completely normal" for the state to make its views clear.

For the new model of the Clio, Pelata said Renault was considering producing the car at its Bursa plant in Turkey or at the Flins plant in France, or at both plants. No decision has been made, he said.

Renault said on Tuesday "several scenarios for the Clio" were being studied, but that the company needed to ensure that the Clio was manufactured as economically as possible.

Shares in Renault were up 2.4 percent at 39.285 euros per share at 1412 GMT.

For a newsmaker on Pelata see (Additional reporting by Sophie Louet and Emmanuel Jarry, Writing by James Mackenzie and Leila Abboud, editing by Marcel Michelson/Will Waterman) ($1=.6873 Euro)

Reuters

Last Mod: 13 Ocak 2010, 20:35
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