Concern raised over Renault move

EU seeks explanation as carmaker moves some production from Slovenia to France.

    Nicolas Sarkozy has assured the move will not
    cause job losses in Slovenia [AFP]

    Explanation sought

    Luc Chatel, the French junior minister for industry, linked Renault's decision to France's $8bn car industry bailout.

    In a radio interview, the minister said the move was a "repatriation of the production" that is the "result" of government help to the auto sector.

    Jonathan Todd, a spokesman for the European Commission, said EU authorities found Chatel's comments "astonishing".

    He said the commission will seek an explanation from French authorities to ensure the move is not protectionist and complies with EU free trade rules.

    Revoz, Renault's subsidiary in Slovenia, has insisted that the decision was not a "relocation of production, but an addition to the production at Flins".

    "Faced with the sharp increase in demand for the Twingo and Clio II models which are currently produced in Slovenia, we were unable to answer market demand," it said.

    Sarkozy triggered concern over protectionism when he suggested that the government's aid package for the sector should be used to rescue French-owned plants in eastern Europe.

    But the EU later said the French plan upheld the bloc's trade rules.

    SOURCE: Agencies


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