Renault Group: two responses to Commercial Courts involving suppliers

Boulogne-Billancourt, November 23, 2021 – Renault Group is fully committed to supporting the automotive sector in France, re-industrialisation and the development of strategic activities for the future within the country. With its transformation underway and faced with the challenges of the mobility revolution, the Group has made France the focus of its industrial and technological strategy. Nevertheless, its industrial and social responsibility in a context of major uncertainties in the automotive market does not allow it to provide unconditional support to its suppliers in difficulty. In order to commit itself, the Group needs solid information on the sustainability of the takeover projects, this is the only way to guarantee realistic prospects for the employees of these companies.

Renault Group is therefore supporting the Saint-Jean Industries Group's plan to take over Alvance Aluminium Wheels, in the Indre region of France. This support will result in the integration of the new company into its panel of suppliers of aluminium wheels for Renault Group's European assembly plants. The Group plans to consult the new company in the development and production of aluminium wheels within the scope of its technical know-how, thus enabling it to access a production volume of up to 500,000 wheels per year for Renault, subject to the usual automotive supply conditions.

Renault Group considers that Alvance Wheels has essential assets such as its know-how and a market enabling to find opportunities to achieve its recovery objectives.  

One of the challenges for the success of Alvance Wheels’ recovery plan will be the transformation of the research department to carry out the development and launch of several projects simultaneously, and thus to carry out the industrialisation assigned by its customers, including Renault.

Renault Group is aware that this takeover project is certainly the last chance to turn the company around after the failures of the past years. Renault Group is confident in the ability of Saint-Jean Industries to make Alvance Wheels sustainable and to consolidate employment on the site.

Concerning Jinjiang SAM in Aveyron, Renault Group cannot commit itself to the Alty-Sifa takeover project. An in-depth analysis of the file does not confirm the turnover assumptions presented in this offer. Once again, as stated in July 2021, this offer does not provide the necessary conditions of sustainability and security for the company and its employees. There are strong doubts about the financial strength, despite the external financial support considered, and the real capacity of Alty-Sifa to invest in and turn around Jinjiang SAM.

Renault also notes that the management difficulties encountered in the past have already led to the legal redress of Sam Technologies and all the subsidiaries of the Arche group in 2015-2016.

As a long-standing customer of SAM, Renault Group recalls that it is the last customer after the departure of all the other car manufacturers and equipment suppliers and the only industrial player to have provided significant direct financial support to the company for many years, with 42 million euros invested in 5 years solely for Jinjiang SAM to alleviate a situation made difficult by the structural lack of competitiveness.

Renault Group has been actively involved since 2016 in the search for a buyer capable of sustaining the activities and maintaining the level of employment in the Decazeville area as it had committed to do. Renault Group conducted negotiations with all of the groups present in France in the foundry business, complementary businesses in metal processing, as well as with all of its aluminium suppliers around the world. All of them declined and did not wish to present a takeover offer. Also, in 2021, Renault Group supported the robust takeover projects twice presented by the Spanish group CIE; projects that were rejected by the employees and various stakeholders.

Renault Group regrets this situation, measures the consequences of its decision and will continue the dialogue with the employees of SAM in order to offer them alternative employment solutions within the Renault Group.