Renault Samsung Chief Executive Dominique Signora made the comments as the company struggles with lower vehicle sales and high labor and manufacturing costs
The chief of Renault Samsung Motors said on Tuesday that restructuring will be inevitable for the survival amid the prolonged coronavirus pandemic and lower demand for its models.
In a message to employees, Renault Samsung Chief Executive Dominique Signora made the comments as the company struggles with lower vehicle sales and high labor and manufacturing costs.
"There is an urgent need to cut costs (through restructuring) to ride out this crisis as the company's overall vehicle sales fell to the lowest level in 16 years since 2004. In particular, exports plunged by nearly 80 percent last year compared to the previous year due to the halted production of the Nissan Rogue SUV in March," Signora said.
Car assembly plants under Renault Group are required to cut manufacturing costs further to secure a new vehicle for production and additional volume for sales for survival amid the COVID-19 pandemic and a paradigm shift in the automobile industry, he said.
For the whole of 2020, Renault Samsung, which is 81 per cent owned by French carmaker Renault SA, sold 116,166 vehicles, down 34.5 per cent from 177,450 units a year earlier, reports Yonhap news agency.
Domestic sales rose 11 percent to 95,939 units last year from 86,859 the previous year, but exports plummeted 78 percent to 20,227 autos from 90,591 over the cited period.
As a result, the Korean unit reported an operating loss worth 70 billion won last year for the first time in eight years.
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