Three Labor Unions Agreed With Renault’s Restructuring Plan image

Three labor unions signed deals with Renault allowing the automaker to proceed with its restructuring plan.

The agreement is “exemplary because it’s a consensual one, signed by organizations representing more than two-thirds of the employees in a country that is more used to arm wrestling with unions,” Chief Executive Officer Carlos Ghosn said today. “It gives Renault the means to revive competitiveness in France.”

Ford, Fiat and PSA Peugeot Citroen are all closing plants and cutting jobs in Europe as auto sales are predicted to fall for the sixth consecutive year. Renault, who saw it sales fall the most compared with its competitors, has promised to keep its plants in France open until 2016 in exchange for a rise in productivity from its workers.

Three Renault’s labor unions, the CFDT, FO and CFE-CGC, which represent about 65% of the company’s workforce, agreed with the strategy, while the CGT, which represents about 25% of the automaker’s employees, opposed the deal.

Renault’s restructuring strategy signed today enables the automaker to eliminate 7,500 jobs in France by 2016 through attrition, freeze wages this year and increase the number of weekly working hours from 32 to 35. These changes are expected to bring the company savings of 500 billion euro.