Renault Offers to Boost Spain Production, Wants Lower Pay, Longer Hours in Return

MADRID – Renault Spain CEO Vicente de los Mozos is proposing a new industrial plan for the 2014-2016 period that would result in record production and the potential creation of up to 1,300 new jobs here.

Union sources say of the 1,300 positions created, 800 would be earmarked for the Palencia assembly plant, 300 for the engine facility in Valladolid and 200 for the Seville transmission plant.

In return, Renault Spain wants labor unions to agree to a cut in monthly wages and the elimination of two annual bonus payments, plus a second-tier pay level for new workers.

It also is seeking more work hours per year, including the flexibility to operate one hour more or less per day depending on production requirements. In addition, the auto maker wants workers to accept straight-time pay for Saturday operation.

De los Mozos says the proposal is the most ambitious industrial plan ever proposed by Renault for Spain. But he cautions that the French auto maker is making similar proposals to other European plants.

“Therefore, Renault Spain considers it necessary to improve the competitiveness of its plants in order to be awarded with that industrial plan,” he says.

If labor unions agree to the proposal, the Palencia plant will be designated for production of a new vehicle platform, plus a spin-off platform to be shared with partner Nissan. Output would be targeted at 280,000 vehicles annually, up from 190,000 currently.

Production of engines in Vallodolid and transmissions in Seville would hit capacity levels in 2014-2015, reaching 1.4 million units each, from 1.1 million today.

Currently, Vallodolid also produces the low-volume Twizy electric vehicle and is preparing for the launch later this year of a compact cross/utility codenamed X-87, which will share some engines with the Nissan Juke and Qashqai models. A version of the X-87 also may be produced for Nissan.

“Though not included in the new-model assignments, the Valladolid plant will take advantage of better competitiveness conditions for future models assignation,” de los Mozos says.

Union reactions have been prudent but noncommittal.

Leandro Martin, a spokesman from UGT, a socialist union, says, “I love how the plan sounds, but it has an important social cost.”

Unai Hernandez, a spokesman from the CGT, an anarchist union, says the proposal has a “very expensive price for the workers and we would pose other alternatives in order to avoid that the workers will be harmed again.”