French Industrial Output Sags

Jan. 9, 2009
Dragged down by auto sector

In November French industrial output sagged again, dragged down by a sharp drop in automobile production, the national statistics institute INSEE reported on Jan. 9.

Manufacturing production, which excludes food and energy, fell 3.1% in November compared with a drop of 4.4% in October.

The automobile sector saw production decline 8.1% in November after a punishing 22.2% drop-off the previous month.

Renault on Jan. 9 said its 2008 yearly sales had contracted 4.2% to 2,381,476 vehicles. Sales at Renault, which the company had hoped would rise by 10% in 2008, had increased 2.2% in 2007. "The depth of the crisis affecting the automobile sector and the brutal decline in our main markets prompted us to revise our growth goals in 2008," Renault commercial director Patrick Blain said. In the the current year the manufacturer is banking on the appeal of two new compact models, dubbed Scenic and Grand Scenic, as well as its low-cost Logan, built by Romanian subsidiary Dacia.

INSEE reported that overall industrial output fell 2.4% in November from October, when it had declined 3.7%.

French customs authorities said the country's trade deficit narrowed slightly to 6.247 billion euros (US$8.5 billion) in November from a record 7.038 billion euros in October, as an overall economic slowdown dampened appetite for imports.

Commenting on France's narrower trade deficit in November, analyst Marc Touati of Global Equities said: "Even with the modest decline over one month, the trade deficit remains substantial -- despite a fall in oil prices, which confirms that the French deficit is above all structural."

The government has predicted a record 49.8-billion-euro shortfall for all of 2008. The value of French imports declined in November to 37.471 billion euros from 39,005 billion in October. Exports in November fell to 31.224 billion euros from 31.967 billion in October.

Copyright Agence France-Presse, 2009

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