French cars not ‘made in France’ anymore
French car manufacturers often boost the ‘Frenchness’ of their cars. But more and more they aren’t built in France anymore. Next year the planned car production within the Hexagon will reach 1,71 million units, 22% less than the 2,21 million this year.
Normally the French are proud of their cars and the industry producing them. Also the two big French car manufacturers, PSA and Renault, are often referring to this ‘quality.’ But in reality, the number of cars produced in France is shrinking every year.
OICA, the international association of car manufacturers, calculated that only one car out of 4 sold by the French carmakers is effectively built in France. The newspaper Le Parisien recently rang the alarm bell: “Eight out of the ten best-sold models in France are produced abroad.”
Engine of prosperity
“France is neglecting the sector that could be the motor of its economy,” says David Barroux in the economic newspaper Les Echos. And this motor was providing work for many people: 40 years ago Renault employed more than 100.000 people in France, now they are less than 50.000. Peugeot and Citroën saw the number of employees halve to 60.000 in 15 years.
And that’s only the workforce directly employed. Of course, you have to take into account all the other people working indirectly for this industry, via suppliers, service providers, research institutions, etc.
The reason that fewer cars are produced in France is fairly obvious. The wages in for example Spain or Slovenia are (much) lower. So the workers over there are benefitting from these relocations.
But not only them. As well Renault as PSA saw their benefit increase because of this ‘outsourcing.’ Last year PSA even noted a record increase in profitability of 47%.
Of course, the French manufacturers are trying to soothe the worried politicians and the public about the disappearing employment. At PSA they say that ‘star models’ like the DS 3 Crossback or the Peugeot 5008 are still made in France.
Renault says that it is going to make ‘ an epicentre of electric production’ of its Douai plant in Northern France. But in Flins, the new model of the very popular Clio (450.000 sales per year) will leave the factory. It will be replaced by Zoé.
This also thoroughly revised model is the best-selling electric Renault, but that meant only 40.000 units last year. Plans are to sell 60.000 to 120.000 units of it next year, but still, the people in Flins are asking themselves if this will be enough to compensate for Clio.
An electric car is far easier to produce and assemble compared to a classic one with an internal combustion engine. So when the electric car is finally breaking through, all manufacturers will struggle with a workforce surplus. And where will those disappear first? Where the cost is the highest.