French automobile company Renault has announced plans to reduce its workforce by 3,000. According to a report from French newsletter L’Informatique dated Saturday, October 5, the company plans to cut jobs through a voluntary redundancy program for workers in support roles.

Some of the support areas that Renault intends to reduce by 15% include human resources, finance, and marketing. It is part of the company’s cost-saving project known as “Arrow.” The reduction is expected to result in approximately 3,000 job losses at the firm’s headquarters in Boulogne-Billancourt, near Paris, and other locations worldwide.

This development comes after the introduction of a commercial version of the French automaker’s new Renault 4 E-Tech crossover. Described as the Societe, this new line of electric cars for professionals skips the traditional van look in favor of something much more subtle. In 2021, Renault unveiled a concept inspired by the classic Renault 4 Fourgonnette, sparking hopes for a retro revival. But with the new 4 E-Tech Societe, the automaker opted for a more budget-friendly approach.

Renault reveals job cuts program amid cost-cutting measures

According to the newsletter, reports of the workforce reduction are corroborated by a source with knowledge on the topic of discussion. The source, which is close to the company, revealed that a final decision could be made by the end of this year. When asked about the topic, Renault confirmed that it is exploring cost-cutting measures. The company also stated that no specific number has been decided.

A spokesperson for Renault clarified that the firm has embraced this approach due to increasing uncertainties in the automotive market and the intense competitive nature of the industry. “Therefore, we are looking into ways to streamline our operations, improve execution speed, and lower our fixed costs,” the spokesperson added. The total number of Renault’s workforce in 2024 was 98,636 employees globally.

In July, Renault announced a net loss of € 11.2 billion, roughly equivalent to $13 billion for the year’s first half. This included a €9.3 billion write-down related to its partner, Nissan. Notably, without this write-down, the net income would have dropped to €461 million, which is lower than one-third of the previous year’s. This drop resulted from a weaker van market, increased costs related to electric vehicles, and pressure from swift industry competition.

Significant challenges threaten operations

Analysts have also raised concerns about how François Provost, CEO of Renault, manages the company’s profit margins. According to them, Provost, who replaced Luca de Meo in July after he was poached by the owner of Gucci Kering, needs to address profit margins as soon as possible. They also highlighted that he needs to work to bring Renault’s credit rating back up to an investment grade, while figuring out how the relatively small car company can survive US tariffs and stiff competition from Chinese rivals.

This issue was raised after reports from sources revealed that although Renault has been largely protected from US tariffs, as it does not have a footprint there, it has been indirectly hit by greater commercial pressure as European rivals seeking new markets outside the United States step up efforts to sell in its home region of France.

In the meantime, the company reported zero growth in second-quarter sales volume and cautioned that sales performance was weak in June. It also faces increasing competition from Chinese newcomers in the electric car and hybrid markets. Barclays analysts suggest that Renault may have experienced slower price-mix momentum during the first half of the year. The company is due to announce full first-half results soon.

The post Renault announces plan to cut 3,000 support jobs first appeared on Coinfea.