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French automaker Renault signed a deal with unions on Wednesday to cut 7,500 jobs and increase working hours in exchange for a pledge to avoid factory closures.
After signing the deal with three unions -- Force Ouvriere, CFE-CGC and CFDT -- Renault CEO Carlos Ghosn called it a "historic" step in French labour relations.
"This is a balanced agreement.... It gives Renault the means to renew its competitiveness in France," Ghosn said.
The agreement foresees a 6.5 percent increase in working hours, a salary freeze this year and 7,500 job cuts by the end of 2016, mainly through attrition and early retirement.
In exchange the company agreed not to close any of its five factories in France before the end of 2016.
Renault earned a net profit of 1.77 billion euros ($2.3 billion) in 2012, but is seeking to scale back its production after new car sales in France plunged by 14 percent last year.