Renault announced plans to build alliance partner Nissan's Micra mini in France as it bolsters domestic production in return for union concessions.
Renault's Flins plant, near Paris, will begin assembling the Micra subcompact for Europe in 2016, with an annual production target of 82,000 vehicles, the carmaker said on Friday.
"This announcement is good news for Flins, but also for all Renault plants in France," Renault-Nissan chief Carlos Ghosn said in a company statement. "Renault is in line to fulfil its commitments."
In return for labour concessions obtained last month, including wage restraint and longer hours, Renault promised to increase domestic production by about a third, or 180,000 vehicles, by 2016.
Ghosn, who heads both Renault and 43.4 percent-owned Nissan, had previously threatened to move some Renault production out of France if no deal was reached with unions.
As part of the agreement, he pledged to repatriate models including the Trafic commercial van from Spain to Sandouville, in northern France. Some versions of the Renault Clio subcompact will also return to Flins from Turkey, the company has said.
Renault's announcement closely followed the disclosure by Nissan that it had asked Renault to assemble the next Micra at an unspecified European site.
Renault won agreement on the new labour deal from unions representing almost two thirds of its workforce, although the left-wing CGT refused to sign.
The labour deal will generate annual savings of about 500 million euros ($650 million), Ghosn has said.
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