France readying multi-billion euro loans for Air France, Renault
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France is readying a historic package of multi-billion euro loans to help carmaker Renault and flag-carrier Air France through the crisis caused by the coronavirus, Finance Minister Bruno Le Maire said on Friday.
For Air France, a 7 billion euro ($7.5 billion) package is planned, made up of 4 billion euros in bank loans guaranteed by the state and a 3 billion euro loan direct from the state, he told TF1 television.
"We need to save our national company and the 350,000 direct and indirect employees affected," he said, while describing the plan as "historic support".
"We are behind Air France, behind the employees of Air France to guarantee our independence and save jobs," he added, while denying that nationalisation was on the cards.
But he warned that the help was not a "blank cheque" and would come with "conditions" linked to its profitability but also environmental factors.
"Air France should become the most environmentally respectful airline in the planet. This is the most important condition for me," Le Maire said.
"Air France needs to present a plan for reducing CO2 emissions and transforming its fleet to be less polluting," he said.
Air France-KLM, formed after a merger with the Dutch flag-carrier, has said it expects more than 90 percent of its planes to be grounded this month.
A separate package is expected from the Dutch government.
Airline industry group IATA estimates that the coronavirus outbreak will cost its members some $259 billion this year alone.
For Renault, a 5 billion euro ($5.4 billion) bank loan package guaranteed by the state is being worked on, he said.
"What is at stake here is our automobile industry. Renault is an industrial flagship that belongs to our culture and history," he added.
Renault reported Thursday a 19.2 percent plunge in first-quarter sales amid a general market collapse caused by the novel coronavirus.
The French state retains shareholdings in both Renault and Air France.
"This crisis is historic. It will last years. It will be long. It will be difficult. I want every businessperson to know that.... the state will be beside them," Le Maire added.
He said France would do everything "to save its companies and start again with an economy that is more respectful for the environment."
© 2020 AFP