PARIS (Reuters) – Renault <RENA>PA> has put one of its historic buildings up for sale in Boulogne-Billancourt, the birthplace of the carmaker, to cut costs, three sources close to the company told Reuters.
The five-story building, located in the old part of Boulogne-Billancourt, a suburb on the outskirts of Paris, houses trade unions, sports facilities and archives.
The tenants have been told they can stay on after a new owner is found, the sources said.
“The goal is to sell the building, if possible this year. Management of the property division is currently working on a few projects of that kind,” one of the sources said.
The French carmaker’s plans to upgrade and expand its “Technocentre” in Guyancourt outside Paris, its largest research and development centre, could also be on put on hold, two of the sources said.
Renault declined comment.
Renault was already struggling before the coronavirus crisis hit sales and brought production to a halt.
In February, the company reported its first loss in 10 years on faltering demand and lower income from its Japanese alliance partner Nissan <7201.T>.
Renault is due to outline some 2 billion euros in cost cuts from mid-May, alongside a joint strategy update with Nissan on how to revitalise their alliance, as the company tries to tackle shrinking margins.
On Wednesday, two sources close to the company told Reuters that Renault was also considering cutting the number of sub-contractors it uses to develop car models in its engineering division. That would potentially save the carmaker between 100 million to 200 million euros.
Renault, which is 15% owned by the French state, has been put under more pressure by the pandemic, and the government said last week it was working on a 5 billion euro aid package for the group.
Renault’s upgrade of its Technocentre includes the re-design of 12,000 workstations spread over seven buildings for an estimated cost of several hundred million euros.
To date, the group has started construction on one new building and expansion of parking lots. The company is now reviewing the rest of the project, initially projected to run until 2022.
“The project has not been stopped but put on pause,” one of the sources said.
(Reporting by Gilles Guillaume, Writing by Dominique Vidalon. Editing by Jane Merriman)