ASCOT, UK - Toyota's decision to build a car plant in France 'has given every single person in the company a sense of urgency about achieving' Renault's cost-cutting goal, said executive vice president Carlos Ghosn.
Renault is pushing to cut FF20 billion ($3.3 billion) before Toyota starts building cars in France in 2001.
Ghosn's plan calls for saving FF8 billion this year and FF6 billion in each of the next two years.
'The main effort to achieve these savings by 2000 must be made now,' said Ghosn at the introduction of the Clio in the UK.
Distributing the cuts equally over three years would risk failing to reach the goal, he said.
About FF10 billion will be cut out of Renault's purchasing bill, he said. Other large areas to cut are manufacturing costs (FF5 billion), marketing and distribution (FF2 billion), and engineering (FF1.5 billion).
Renault must transform its relationship with suppliers, said Ghosn. 'This makes the difference between a company that is cost competitive and one that is going nowhere.'
He said Renault wants 'to enhance our competitiveness, rather than to reduce our costs. We are very careful not to reduce the level of innovation or quality.'
Toyota plans to build a new supermini in Valenciennes, France, starting in 2001.
'We are not masochists who are happy that Toyota will be in France,' said Ghosn, 'but we have to compete against them anyway.'