PARIS (Reuters) - Renault’s (RENA.PA) chief executive warned on Friday that the French carmaker could disappear “in its current form” if it is unable to be competitive at home as European car markets face a lasting slump.
Renault would also not be able to avoid cutting jobs in France if the market’s decline proves to be deep and lasting, Carlos Ghosn said in an interview with France 24 television during the Paris auto show.
Asked in a separate interview with RTL radio if Renault could disappear, Ghosn said: ”In its current form, yes.
“Each company is tied to its home country. I do not know of any company that can be viable, that can prosper from a base that is not competitive. A company needs a natural base, Renault’s natural base is France.”
Automakers in Europe are struggling to cope with a glut of excess capacity amid a sustained market decline. Renault has forecast a 13 percent drop in the car market in France and an 8 percent decline in Europe this year.
French arch-competitor PSA Peugeot Citroen (PEUP.PA) has said it plans to cut more than 10,000 jobs, close one assembly plant and shrink another. Ghosn told France 24 that Renault had no plans at this stage to cut jobs in France.
Renault intends to ask unions for a new nationwide deal on pay and conditions to avert mass layoffs, Chief Operating Officer Carlos Tavares told Reuters at the auto show on Thursday.
Tavares told BFM radio on Friday that European car markets may take three to five years to return to pre-crisis levels.
“We are not certain to have touched bottom yet,” Tavares said. “We are now stuck in a situation that could last.”
Reporting by Dominique Vidalon; Editing by James Regan