Title: The restructuring of the automobile industry: the experience of Renault

Authors: Raymond H. Levy

Addresses: Chairman and Chief Executive Officer, Renault, France

Abstract: The European automobile industry has ben undergoing a major restructuring in the 1980s in response to greater worldwide competition, particularly from Japan. Renault was badly hit in the early 1980s by cash flow problems and faced a crisis situation. Its response was to undertake a company-wide restructuring with the emphasis on restoring management quality and strengthening quality management. The objective was defined as the achievement of |total quality|. In addition, the workforce was reduced by 30% over a three year period, profit-sharing was introduced, and overheads reduced by 8% per annum. The company divested itself of subsidiaries not involved in its core business of automobile manufacture. The results have been a return to profitability and a dramatic increase in levels of productivity.

Keywords: automotive manufacturing; automobile industry; management quality; total quality; profitability; productivity; Renault; Europe; quality management.

DOI: 10.1504/IJTM.1990.025838

International Journal of Technology Management, 1990 Vol.5 No.2, pp.131 - 140

Available online: 25 May 2009 *

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