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Renault to make further cost cuts

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Renault to make further cost cuts

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Renault’s announced more strict cost-cutting measures which could add to Spain’s massive jobless figures.

Its factory in Valladolid is under threat as market conditions for this year are worse than expected according to Renault chief, Carlos Ghosn. He said: ‘‘The operational margin was still in line with our commitment at the end of the first three month period in 2008, but the brutal fall in volume in the second three month period in 2008 put our objectives totally out of reach.’‘ In other words, big cuts need to be made. The carmaker has already announced some 9000 workers are to go. And with the French government handing France’s car industry a 6 billion euro bailout this week to keep French factories open, it means Renault’s Spanish workers are in the firing line. Despite an overall profit of almost 600 million euros in 2008, net profit fell a massive 78 per cent from 2007. The car maker has also announced a freeze on all dividends and staff bonuses as it seeks to weather the global fall in car sales.