The light commercial vehicle joint venture between Renault and China Brilliance Automotive is no longer paying employees’ salaries, moving it another step closer to liquidation, reports the South China Morning Post.
Renault Brilliance Jinbei Automotive, in which Renault owns a 49% stake, earlier this week told more than 1,000 employees that the company would not be able to pay them monthly salaries, and that it would not contribute to their pension schemes either, according to two sources that have business ties with the vehicle maker. They added that it was highly likely that the venture would undergo liquidation soon.
The two partners had pinned their hopes on fresh capital from new investors, but the chances of this happening were slim, because it would be difficult to turn the venture around even with additional investment, the sources said. Renault would not comment on the matter, while Brilliance could not be reached for comment on Wednesday.