May 11, 2020 / 6:48 AM / 25 days ago

French carmakers must bring production back for aid: minister

PARIS (Reuters) - French carmakers must bring more production back to France in exchange for government support for the struggling industry, the finance minister said on Monday.

FILE PHOTO: Employees, wearing protective face masks, work on the automobile assembly line of Renault ZOE cars at the Renault automobile factory in Flins as the French carmaker ramps up car production with new security and health measures during the outbreak of the coronavirus disease (COVID-19) in France, May 6, 2020. REUTERS/Gonzalo Fuentes

Along with tourism and aerospace, carmaking is one of three industries for which the French government is preparing sector-specific recovery plans to help them back on their feet after the coronavirus crisis.

Finance Minister Bruno Le Maire said he would hold meetings this week with representatives of the country’s car industry about the recovery plan, which is expected at the end of August or September.

“We are ready to help you, we are ready to improve incentives for new cars, we are ready to look at what can improve your competitivity at French production sites,” Le Maire said on BFM Business radio.

“In exchange it’s going to be what’s your relocation plan? That’s how we will build a stronger automobile industry,” he added.

The government is already working on a 5 billion euro ($5.4 billion) package of state-guaranteed loans for carmaker Renault (RENA.PA), which is 15% owned by the state.

Renault had to suspend production at one of its French factories last week following a court order sought by the hardline CGT union, which considered the site’s measures to protect workers against the coronavirus to be insufficient.

Le Maire said the CGT’s move, which was criticised by more moderate unions, sent the wrong signal at a time when France was looking to bring back production.

“There are certain union leaders who are playing with fire,” Le Maire said.

(This story has been refiled to fix typo in “suspend” in paragraph 7.)

Reporting by Sudip Kar-Gupta and Leigh Thomas; Editing by Toby Chopra and Mark Potter

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