GROUPE RENAULT: Press Release - Cost reduction plan project 2o22
29 Mai 2020 - 7:30AM
GROUPE RENAULT: Press Release - Cost reduction plan project 2o22
PRESS RELEASE
GROUPE RENAULT PRESENTS ITS DRAFT PLAN
TO REDUCE FIXED COSTS BY MORE THAN 2 BILLION EUROS OVER THREE
YEARS
- The objective of reducing fixed costs by more than 2
billion euros over 3 years aims to restore the Group's
competitiveness and ensure its long-term development within the
framework of the Alliance.
- The draft plan is based on the efficiency of operations
within Groupe Renault: by simplifying processes, reducing the
diversity of components within vehicles and adjusting industrial
capacities.
- The planned changes will be implemented in consultation
with the social partners and local authorities within the framework
of an ongoing dialogue.
Boulogne-Billancourt, May 29, 2020 – As promised
when it announced its annual results, Groupe Renault today presents
its transformation plan, which aims to achieve savings of more than
€2 billion over three years and to lay the foundations for a new
competitiveness.
The difficulties encountered by the Group, the
major crisis facing the automotive industry and the urgency of the
ecological transition are all imperatives that are driving the
company to accelerate its transformation.
The draft plan will strengthen the company's
resilience by focusing on cash flow generation, while keeping the
customer at the centre of its priorities. It is based on a more
efficient approach to operational activities and rigorous
management of resources.
Beyond this, the draft plan aims to lay the
foundations for Groupe Renault’s long-term development. In France,
the Group would be organized around strategic business areas with a
promising future: electric vehicles, LCVs, the circular economy and
high value-added innovation. These major regional centres of
excellence based in France would be at the heart of the Group's
recovery. In Flins and Guyancourt, the Group would reorganise its
activities.
If Groupe Renault plans to make the necessary
workforce adjustments to enable a return to profitable and
sustainable growth, it is committed to ensuring that they are
carried out through exemplary dialogue with social partners and
local authorities. This workforce adjustment project would be based
on retraining measures, internal mobility and voluntary departures.
It would be spread over three years and would concern nearly 4,600
posts in France, to which would be added the reduction of more than
10,000 other positions in the rest of the world.
"I have confidence in our assets, our values and
in the management of the company to succeed with the envisaged
transformation and to return our Group to its full value by
deploying this plan. The planned changes are fundamental to ensure
the sustainability of the company and its development over the long
term. It is collectively and with the support of our Alliance
partners that we will be able to achieve our objectives and make
Groupe Renault a major player in the automotive industry in the
years ahead. We are fully aware of our responsibility and the
planned transformation can only be achieved with respect for all
our Group's stakeholders and through exemplary social dialogue,"
said Jean-Dominique Senard, Chairman of the Board of Directors of
Renault.
"In a context of uncertainty and complexity,
this project is vital to guarantee a solid and sustainable
performance, with customer satisfaction as a priority. By
capitalizing on our many assets such as the electric vehicle, by
capitalizing on the resources and technologies of Groupe Renault
and the Alliance, and by reducing the complexity of development and
production of our vehicles, we want to generate economies of scale
to restore our overall profitability and ensure our development in
France and internationally. This project will enable us to look to
the future with confidence," added Clotilde Delbos, interim Chief
Executive Officer of Renault.
The project includes the following main
elements:
- Improving efficiency and reducing engineering costs, by
taking advantage of the strengthened assets of the Alliance,
approximately €800 million:
- Streamlining vehicle design and development: reducing component
diversity, increasing standardization, Leader - Follower programs
within the Alliance.
- Optimization of resources: concentration of the development of
strategic technologies with high added value in the engineering
sites of Ile-de-France; optimization of the use of R&D centres
abroad and subcontracting; optimization of the means of validation
through the increased use of digital.
- Optimization of production saving approximately €650
million
- Acceleration of plant transformation through the generalization
of Industry 4.0
- Process improvement in new engineering projects: accelerating
digitalization and "design to process".
- Right sizing of industrial capacities:
- Global production capacity revised from 4 million vehicles in
2019 to 3.3 million by 2024 (Harbour reference).
- Adjustment of production headcount.
- Suspension of planned capacity increase projects in Morocco and
Romania, study of the adaptation of the Group's production
capacities in Russia, study of the rationalization of gearbox
manufacturing worldwide.
- In France, four working hypotheses for optimizing the
production will be the subject of in-depth consultation with all
stakeholders, in particular the social partners and local
authorities:
- Renault is launching a consultation process on the Douai and
Maubeuge plants to study the creation of an optimized centre of
excellence for electric vehicles and light commercial vehicles in
northern France.
- Open reflection on the reconversion of the Dieppe plant at the
end of the production of the Alpine A110.
- In Flins, the creation of a circular economy ecosystem on the
site, including the transfer of Choisy-le-Roi's activities.
- At the Fonderie de Bretagne, Renault is launching a strategic
review.
- Increased efficiency of support functions,
approximately €700 million
- Optimization of general and marketing costs: digitalization to
optimize marketing costs, rationalization of the organization and
reduction of costs related to support functions, etc.
- Refocusing activities for a better allocation of
resources
This refocusing on the Group's core business
through a change in its scope would concern in particular:
- Part of the RRG integrated distribution network in Europe.
- The transfer of Groupe Renault's stake in Dongfeng Renault
Automotive Company Ltd (DRAC) in China to Dongfeng Motor
Corporation and the cessation of Renault branded passenger car
combustion engine activities in the Chinese market.
These plans will be presented to employee
representative bodies in accordance with applicable regulations.The
estimated cost of implementing this plan is in the order of €1.2
billion.
About Groupe Renault
Groupe Renault has manufactured cars since 1898.
Today it is an international multi-brand group, selling close to
3.8 million vehicles in 134 countries in 2019, with 40
manufacturing sites, 12,800 points of sales and after-sales and
employing more than 180,000 people. To address the major
technological challenges of the future, while continuing to pursue
its profitable growth strategy, Groupe Renault is focusing on
international expansion. To this end, it is drawing on the
synergies of its five brands (Renault, Dacia, Renault Samsung
Motors, Alpine and LADA), electric vehicles, and its unique
alliance with Nissan and Mitsubishi Motors. With a 100% Renault
owned team committed to the Formula 1 World Championship since
2016, the brand is involved in motorsports, a real vector for
innovation and awareness.
Contacts Astrid DE
LATUDECorporate Press Officer+33 (0)6 25 63 22
08astrid.de-latude@renault.com
Celine FURETCorporate Press Officer +33 (0)6 17
41 13 41celine.furet@renault.com
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Release