What if 8 June 2021 became the anniversary of the French car revolution?

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The six trade union organisations (OS) representing the employees of three of Renault's industrial sites all signed an agreement without exception, which provides for the creation of a new company, a wholly-owned subsidiary of Renault, which will manage the revitalisation of an automobile basin by mobilising electrification as a lever.
 
As the FO metals press release on this signature states: "For the first time since 2013, the agreement meets our ongoing demand, namely, the production of a B-segment vehicle on national territory (the future electric R5) and the allocation of new C-segment models."
 
In fact, FO, like the five other unions, had carefully read the "road map" that Luca de Meo had sent them in September and all of them, like us at the time, had stopped at this passage where, surreptitiously, the new boss indicated: "We must concentrate on the CMF-B-EV platform, developing a range of emblematic, profitable electric vehicles, with an entry price of less than 20,000 euros, produced in France."
 
L. De Meo, like the SOs, knew that if this intention were to become reality then, for Renault, we would be changing times: 
i) the management would go from an attitude which, de facto, has not been denied since the 2000s to a form of mistrust of the French site which has resulted in a drop in the share of French assembly in the supply of Renault brand vehicles to the European markets (not to mention the Dacia); 
ii) the reformist unions which signed and supported the competitiveness agreements to "save" the sites without always succeeding and, in any case, without ever managing to stop the decline in production and staff numbers could finally return to the negotiations believing in them and without fearing to ask their troops to make efforts or sacrifices "for nothing";
iii) the non-signatory unions such as the CGT or Sud, who are also asking for a "return of B in France", would have to either deploy a great deal of trade union casuistry in order not to sign, and would then run the risk of not being understood by the base, or agree to join the ranks of the signatories, or even to let themselves be won over by the hope of a revival of activity.
 
Since September, everyone had been waiting for signs of confirmation, which were slow to appear, even though no evidence had emerged to contradict the announcement. If this was the case, it was simply because the negotiations were taking place with the unions but also with the industrial partners and/or with the local and central public authorities.
Luciano Biondo, who was very appropriately hired from Toyota Valenciennes just after the summer, was in charge of conducting the main part of these negotiations and, in the opinion of all concerned, the agreement signed on 8 June owes him a lot. The purchasing department and all the departments of the company, and even of the Alliance, also had to commit themselves to choosing and involving the battery partner, the Chinese Envision, or the three equipment manufacturers involved, such as Plastic Omnium, Faurecia or the Indian Motherson.
The R5 project and the one, more mysterious at this stage, of another battery electric vehicle than the Mégane in the C segment also had to be specified in parallel.
 
In short, the project called ElectriCity, which Florence Lagarde outlined on Wednesday 9 June, is not only a major social project. It is also a major project strategically. The last time that the French site was at the heart of Renault's strategy, its profitability and its success, it was at the time of the Scénic. The dazzling success of this vehicle, which enabled Renault to create the C-segment MPV category and established the company as the undisputed leader in this segment for several years, made Renault's commercial and financial fortunes.
The company only had the health necessary at the end of the 90s to do the Nissan, Samsung and Dacia operations thanks to this innovative product. The site which, at the time, embodied the success was French. It was Douai: between 1998 and 2005 Scenic production in Douai was constantly above 300,000 vehicles/year and even reached more than 400,000 (404,485 Scenic I exactly) in 2000.
 
Neither Douai nor any other French site has regained this status: Logan and its "entry" sisters have in a way taken over from Scenic by being the innovative vehicles which allowed Renault to make a real difference with its competitors, but it was Romania and then Morocco which assembled them. As for the less innovative but commercially convincing models proposed by Renault over the last 15 years, they have been produced in Turkey or Spain.
 
 
ElectriCity has set its sights on 500,000 cars at its two assembly sites in Maubeuge and Douai. The product that will drive these volumes and give the project its full measure will undeniably be the B segment vehicle: the R5 electric. This is the basis of the support of the unions because they know that without the B, with the only strategy being the "move upmarket", for Renault as for Stellantis, there is no real hope of re-establishing the position of the French site in the industrial system of the French groups.
 
The French market is dominated by this segment. So is the European market. French manufacturers are fully legitimate in this segment as in the A. They are less so in the C and are marginal in the D. The French automobile trade deficit appeared in 2008 when the B was in the process of leaving. It has continued to deepen since then because this option or doctrine has been confirmed year after year and C and upmarket were obviously not sustainable alternatives for the French site.
Up to now, the public authorities have not been aware of this and have not been able to influence the two manufacturers to change or question this deadly doctrine, and in so doing have condemned themselves to watch helplessly as the decline of the French site is confirmed year after year.
 
ElectriCity is a revolution decided by Renault without any clear political demand. Everything seems to indicate that the local public authorities (the President of the Hauts de France Region for example) have understood that, having failed to initiate the project, it would be appropriate to support it very actively and even to claim to be partly the inspiration behind it.
For the Elysée Palace, which on 26 May 2020 announced very strong ambitions for EVs in France and which has since had to note that, as with internal combustion vehicles, the propensity to import electric or rechargeable hybrid vehicles whose acquisition it supported was of the order of 70% of registrations, this should be a godsend in the same way: by being as passive as usual, the State gets a manufacturer to decide to revitalise the French industry on its own initiative.
 
Like the press, the public authorities should realise here that what is happening in Douai is of major importance and that not to turn it into a much wider opportunity for a rebound would be unforgivable. 
In order for such a rebound to take place and for the relocation movement, which is the main cause of the decline in production and the number of employees in the whole French automobile sector, to be reversed, the return of the B of Renault initiated with the R5 must first of all be clear and appear, if not as irreversible, at least as lasting.
Indeed, we know that if this were to be the case, certain other European sites of Renault competitors could suffer and seek to question this choice. For Renault as a brand, not to mention Dacia, this concerns Bursa, Novo Mesto and Valladolid: these sites, which have so far benefited from the choice of allocation of combustion or hybrid models, will suffer in the coming years from the impact of the rise of ElectriCity.
 
With the support of the States or Regions to which they belong, they will then naturally apply to regain their place in the electric production organisation as they had in the thermal sector, and we must already prepare for this phase 2, which has already begun. One of the challenges in this perspective could be the "bottom model", i.e. the electric R4: going to the end of the utopia that the revolution of 8 June allows us to build would imply that, after the B has returned, the A should also return. It would then be necessary to resist the Slovenian ambitions that are already assembling the electric Twingo.
Beyond Renault, the rebound would also require Stellantis to follow Renault in abandoning the deadly doctrine which has excluded the A and B from France. To date, almost all the EVs sold by Stellantis in Europe are B segment vehicles and are assembled in Spain, Italy or Slovakia.
 
Spain has a prime position in the electrical production organisation of Ste
llantis' electric production organisation with the Corsa, 2008 and C4 in particular. It is clear that the virtuous dynamic that could be created with ElectriCity in terms of volumes will not be extended by Stellantis with the C alone in Sochaux and Mulhouse.
It therefore seems essential that the State, which is not only a shareholder but is also being asked to support the ACC project, to accelerate the installation of charging stations and, above all, to maintain its subsidies for the purchase of electric and rechargeable hybrid vehicles, should do everything in its power to ensure that the French site does not have to make do with Stellantis's electrical crumbs.
 
As is the case with combustion vehicles, the C segment will very quickly - the trend is emerging in the first quarter of 2021 - be taken over by German manufacturers and the ID3 and ID4 will quickly become difficult to dislodge. This does not mean that we should throw in the towel, but the most defensible 'French way' is probably that of the 'clean popular vehicle' in electric form.
This path is particularly opportune for the electric vehicle because electrifying 2-tonne vehicles is technically, economically, socially and environmentally problematic. It is up to all stakeholders to make 8 June 2021 the starting point for this turnaround. The regional elections followed by the presidential elections could well be an opportunity to put the automotive dossier at the top of the pile of dossiers that will have to embody a world of the future that is a little less desperate than the one before. 
 
14/06/2021
 
 
 

The weekly column by Bernard Jullien is also on www.autoactu.com.

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