RENAULT COMPANY IS PREPARING FOR BANKRUPTCY

In recent years, the Renault-Nissan-Mitsubishi alliance is going through difficult times, but the coronavirus can literally finish off the Renault Company. The automaker is at risk of going bankrupt and the complete termination of the activities.

This information was announced by the French Minister of Finance Bruno Le Mer a few days ago. According to him, the company is currently waiting for help from the state - it needs a loan of $ 5.5 billion. However, the French government has not made a final decision on the saving of the automobile giant yet.

Earlier, Rusbankrot already published an article about the forecast that Carlos Ghosn - the former head of Nissan, gave to the international alliance of car manufacturers. In his opinion, the company still had three more years to survive. However, the pandemic seems to have made adjustments to the work of the automotive industry.

The experts assess the financial condition of the entire alliance, and specifically of the Renault Company as a depressing one.

And if Nissan can still bear the current collapse in the industry, eliminating up to 20 thousand staff units and dismissing 10% of the employees, the French brand will face bankruptcy without billions of loans.

We should recall that the share of the state capital in the Renault's total asset is 15%. In this regard, the experts believe that such a dependence on the state may not allow the automaker to reduce its own costs to a degree, sufficient to overcome the crisis. In particular, Bruno Le Mayor said that he had not signed the credit orders for Renault yet. Many analysts are inclined to perceive this as a direct indication of the measures that should be taken to obtain a life-saving loan to the company’s management.

The French authorities are willing to take the most careful crisis response measures to preserve jobs, and drawing the significant attention to the development of electric transport and to the fact that the leading technology workshops are created specifically in France.

It is already known that the brand should present the new strategy for its development to the shareholders on May 27.

According to the informed sources, the company should save about € 2 billion over the next few years. Given that due to the consequences of the pandemic, total revenue fell by 19% and the European market fell by almost 36%, it would be difficult to achieve such a save.

For the moment, it is expected that the small component manufacturers in France and the workshop of the Alpine assembly plant in Dieppe will be closed. There are rumors that the unpopular car models (in particular, Espace and Talisman) will be removed from the assembly line. The authorities themselves, according to the Minister of Finance, are urging the company’s management to protect the Flins factory from closure, thereby saving 2,600 jobs. The state also plans to save the production workshops, occupied by the Zoe and Nissan Micra electric cars. But we cannot but note that as the pandemic is getting worse, the demand for the company's products continues to fall.