French gov't car help to target r&d, not incentives
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French government efforts to help the country's auto industry will focus on promoting research and development rather than new state-sponsored incentives to buy cars, Labor Minister Michel Sapin said.
"It's not just about boosting car purchases," Sapin told France's BFM TV on Wednesday. "Nobody can say they have the solution ... a magic wand," he said.
Car-scrappage schemes were deployed in France and other countries in 2009 and 2010 to ease the impact of an international economic downturn. Sapin said the problem with purchase incentive schemes was that sales tended to slump after they were withdrawn.
Prime Minister Jean-Marc Ayrault told the French parliament on Tuesday an emergency plan to help the auto industry would be ready later this month.
France's car industry is threatened by big job losses and plant closures as domestic automakers PSA/Peugeot-Citroen and Renault face falling sales at home and in other European markets hit by the euro zone crisis.
France has Europe's second biggest national car industry after Germany's.
Trade union officials have warned that as many as 8,000 to 10,000 jobs could be axed in France under a shake-up at PSA. The French government has asked PSA to clarify its plans quickly.
PSA's situation has deteriorated since last year, when net debt increased to 3.4 billion as the company continued to suffer for its exposure to European markets badly hit by the region's debt crisis.
On Monday, France's CCFA auto manufacturing association said French light-vehicle sales fell 0.9 percent to 248,697 last month, after dropping 17 percent in May.
Reuters contributed to this report
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