Renault told to keep French jobs

Paris - The French government on Tuesday warned carmaker Renault that shifting production to Turkey must not lead to job losses in France.

Employment minister Laurent Wauquiez said there was a "red line" that Renault must not cross - "which is no plant closures and no layoffs."

Press reports that Renault plans to beef up production in Turkey of its popular Clio model prompted the right-wing governing party to call on the government to block the move.

France's number two carmaker, Renault currently divides production of the Clio between its plant in Flins, in the western Paris suburbs, and Bursa in Turkey.

"Renault is not just any ordinary company - the state holds 15 percent and we are not going to be spectactors because this is a company that has received a lot of assistance during the crisis," Wauquiez told RTL radio.

A company that "sells to French consumers must, as much as possible, produce in France," the minister said.

A Renault spokesperson last week did not confirm the report, but said the new Clio 4 would continue to be produced in France and Turkey.

The spokesperson for President Nicolas Sarkozy's UMP party, Frederic Lefebvre, had said a complete shift to Turkey would be "unacceptable" and called for the state to intervene to block any such move.

Over the past decades, France, which prides itself as an industrial powerhouse, has seen many of its plants move to Asia and elsewhere where production costs, in particular labour and taxes, are much lower.

Wauquiez noted that France had recently scrapped the professional tax that businesses pay to local governments, so that the country can keep its industry strong.

- AFP