The company announced Friday that it will cut costs by more than 2 billion euros ($2.2 billion) over the next 3 years. It also plans to reduce the number of cars it makes each year from 4 million to 3.3 million by 2024, and will stop selling Renault-branded vehicles in China.
Renault (RNLSY) is part of the world's biggest carmaking alliance, alongside Nissan (NSANF) and Mitsubishi (MBFJF). Earlier this week, the companies announced they would make fewer models, share production facilities and focus on the existing geographic and technological strengths of each carmaker as they try to slash costs amid the coronavirus pandemic.
Renault said changes were needed because of the scale of the economic fallout from the pandemic, as well as stricter emissions standards. The company, which employs 180,000 people around the world, said it would consult with unions about restructuring some of its plants in France.
"The planned changes are fundamental to ensure the sustainability of the company and its development over the long term," chairman Jean-Dominique Senard said in a statement.
Shares in Renault are down nearly 50% for the year.
The decision to pull the Renault brand out of China is part of the new alliance strategy, which will see each member take the lead in specific geographies while the others follow. Nissan will lead the way in North America, the Middle East and key markets in Asia including China and Japan. Renault will take first position in Europe and South America, while Mitsubishi has been assigned parts of southeast Asia and Oceania.
On Thursday, Nissan announced it is slashing production capacity by 20% and closing a plant in Spain as part of the overhaul.
-- Charles Riley contributed to this report.
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