French workers in uncertainty after cessation of activities in Russia

published on Thursday 24 March 2022 at 16:16 hrs

The cessation of Renault’s activities in Russia on Thursday is stirring some excitement among the French manufacturer’s employees, even though the French factories have been little exposed.

“Renault hasn’t been in top shape for two or three years, we didn’t need that in the current context, it’s an extra fear,” said Jean-Franà ois Pibouleau, CGT deputy of the central union.

“The crisis of components such as the evolution of the geopolitical situation in an open economy context (…) highlights the vulnerability of large groups like ours,” the CFDT, for its part, responded in a press release, calling for the creation of 100% integrated “production plates”.

The impact of the suspension of Renault’s Russian activities is expected to be limited initially because “we are not receiving parts from Russia”, assures Jean-FranÃois Pibouleau for whom “the semiconductor crisis” remains the biggest annoyance of the moment .

Only the Le Mans plant supplied some elements to Russia, according to the CGT, namely “chassis or rotary elements”.

“The impact will be much more financial, on the results,” said Mariette Rih, central FO union representative.

Renault warned it was “forced to revise its financial outlook for the year 2022 with a group operating margin of around 3%”, up from more than 4% previously.

In anticipation, Renault plans to include an adjustment cost of EUR 2.195 billion in its accounts for the first half, the value of its assets in Russia.

The French manufacturer has its own factory near Moscow, which employs 2,500 people and produces SUVs Duster, Kaptur, Arkana and Nissan Terrano.

All workers “have been put on leave”, said Jean-FranÃois Pibouleau. “We’ve asked HR (human resources) to update us quickly on what they’re up to so that employees are as unimpressed as possible,” he added.

Renault primarily owns 69% of AvtoVAZ, the major Russian manufacturer that produces the two best-selling cars in Russia, the Lada Vesta and Granta. The 40,000 employees of the Togliatti factory have been on holiday for three weeks since March 16 due to a shortage of imported components. The French manufacturer plans to assess “the possible options regarding its participation”.

On Wednesday, Ukrainian President Volodymyr Zelensky had denounced Renault’s presence in Russia before the French National Assembly, while the head of Ukrainian diplomacy, Dmytro Kouleba, called for a boycott.

“We do not agree with that because the boycott is the workers who suffer immediately,” lamented the CGT.

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