Renault plans to save 2 bn euros by 2022 at 1.2 bn euros cost

According to Renault, as per its draft plan, 4,600 posts will be in France and the balance 10,000 posts in rest of the world.

As per the draft plan, Renault plans to achieve its cost savings by increasing the common parts across the models, reducing the diversity in vehicles/engines, optimisation of research and development resources across the world, right sizing of global production capacities; and scrapping capacity expansion plans in Morocco and Romania.

Renault also plans to accelerate its plant transformation through the generalisation of Industry 4.0, and accelerating digitalisation and design to process.

The group will also cut down its vehicle production to 3.3 million units by 2024 from 2019 level of 4 million units and also accordingly adjust the production headcount.

Renault also plans to increase efficiency of support functions like general and marketing.

According to Renault, the plans will be presented to employee representative bodies in accordance with applicable regulations.

The estimated cost of implementing this plan is in the order of 1.2 billion euros.

In a statement, Renault said the difficulties encountered by the Group, the major crisis facing the automotive industry and the urgency of the ecological transition are all imperatives that are driving the company to accelerate its transformation.

It said the draft plan aims to lay the foundations for the group's long-term development.

"I have confidence in our assets, our values and in the management of the company to succeed with the envisaged transformation and to return our Group to its full value by deploying this plan. The planned changes are fundamental to ensure the sustainability of the company and its development over the long term," Jean-Dominique Senard, Chairman of the Board of Directors of Renault, was quoted as saying in the statement.

"It is collectively and with the support of our Alliance partners that we will be able to achieve our objectives and make Groupe Renault a major player in the automotive industry in the years ahead. We are fully aware of our responsibility and the planned transformation can only be achieved with respect for all our Group's stakeholders and through exemplary social dialogue," he added.

Clotilde Delbos, Interim Chief Executive Officer of Renault, said: "In a context of uncertainty and complexity, this project is vital to guarantee a solid and sustainable performance, with customer satisfaction as a priority.

"By capitalising on our many assets such as the electric vehicle, by capitalising on the resources and technologies of Groupe Renault and the Alliance, and by reducing the complexity of development and production of our vehicles, we want to generate economies of scale to restore our overall profitability and ensure our development in France and internationally. This project will enable us to look to the future with confidence."