PARIS: French carmaker Renault said on Wednesday it will combine three of its plants in northern France into a new legal entity, Renault ElectriCity, that will produce 400,000 vehicles a year by 2025.
Renault said in a statement the new entity would lead to the creation of 700 jobs spread across the various sites, which currently employ nearly 5,000 people, by 2025.
Renault, which is looking to produce fewer and more profitable cars under its new boss Luca de Meo, is grappling with rising competition in the market for electric cars, an area where it had an early lead but bigger rival Volkswagen is is catching up.
“Renault Group and the representative trade unions (CFDT, CFE-CGC, CFTC, CGT, FO and SUD) have signed an agreement for the future of the Renault sites in the Hauts-de-France region”, the carmaker said.
“This agreement gives birth to Renault ElectriCity: the legal entity wholly owned by Renault SAS and grouping together the industrial sites of Douai, Maubeuge and Ruitz”, it added.
Douai is a car assembly site, Maubeuge a commercial vehicles assembly plant and the Ruitz site, which manufactures gear boxes, will be assigned a new electrical components manufacturing role, Renault said.
Renault shares were unchanged in early trade, slightly underperforming Paris’ CAC 40, up 0.1%.