More money could soon be poured into France’s beleaguered auto industry with a top French official revealing that “several billion euros” in extra help may soon be offered to the country’s auto makers amid collapsing car sales.
According to a report from the Associated Press, Industry Minister Luc Chatel informed journalists that the government may be willing to cover up to 50 per cent of the car manufacturers’ financial needs in order to help them ride out the credit crunch as long as there is a guarantee against factory closures.
The government held a meeting yesterday with the French car makers, suppliers and labour unions to discuss the fallout from the economic crisis after Renault reported a 28.5 per cent fall in vehicle sales in December marking an annual slump of 4.2 per cent; while PSA Peugeot Citroen also announced a 4.9 per cent annual drop.
It will not be the first action taken by the French government which has already introduced a €1,000 bonus for customers who trade in old cars for newer, lower-emission vehicles. It also made €1billion in low-interest loans available to the French car makers to help customers finance purchases.
The government already owns 15 per cent of Renault and is considering raising its ownership.
Green cars are also seen as key to the future of the industry with the government keen to encourage the development of electric cars and other green technologies.
