France Investigates Renault Spying Case

The French security services have launched an investigation into allegations of industrial espionage at the giant French car maker Renault The company suspended three managers earlier this week, and today the Paris newspaper Le Figaro said the executives had provided company secrets to China. Renault, together with its Japanese partner Nissan, has been at the forefront of research into electric vehicles and battery technology in recent years. It's believed the information leak was related to that research.

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MICHELE NORRIS, host:

This is ALL THINGS CONSIDERED from NPR News. I'm Michele Norris.

MELISSA BLOCK, host:

And I'm Melissa Block.

A spy story in France has caught that nation's attention. The main French carmaker, Renault, suspended three of its senior managers this week for suspected espionage. And there are allegations of a Chinese connection.

Eleanor Beardsley reports from Paris.

(Foreign language spoken)

ELEANOR BEARDSLEY: The story of the Renault spies has dominated news coverage in France. The three men who worked in the carmaker's electric vehicles division have been accused by Renault of leaking company secrets. The newspaper Le Figaro says the recipients were intermediaries specializing in economic intelligence. The paper quoted a Renault source as saying the most likely final recipient of that information was a Chinese carmaker.

Reporter Bill Diem covers the car industry in France. He says Renault and its partner Nissan are investing billions of dollars in electric car technology.

Mr. BILL DIEM (Journalist): Between Renault and Nissan, they're investing 4 billion euros over the next three or four years to put out a total of eight electric vehicles. Nobody else is doing anything like that much.

BEARDSLEY: The French government, which owns a 15 percent stake in Renault, is taking the accusations very seriously. The auto sector is a major employer in France. President Nicolas Sarkozy is reported to have asked French intelligence services to investigate the role China might have played in the affair. French industry minister Eric Besson warned of an overall risk to French industry.

Mr. ERIC BESSON (Industry Minister, France): (Through translator) This is a huge danger for French industry, and what happened at Renault is nothing less than economic warfare. We have to be on our guard for the future.

BEARDSLEY: One of the biggest advantages that Western carmakers have is their advanced technology, which enables them to compete against cheaper labor costs in developing countries. It's not the first time the French auto industry has been targeted by industrial spies. Both parts manufacturer Valeo and tire maker Michelin have been hit. However, security experts say France itself is one of the top offenders when it comes to industrial espionage.

Journalist Bill Diem says he wonders if Renault isn't overreacting. He remembers how the company responded when a magazine published a photo of one of its prototypes, a common occurrence in the automobile press.

Mr. DIEM: Renault went ballistic and they made a complaint to the police, and the police arrested the journalist who had printed it in his magazine. And that's crazy. Well, it just makes me think that Renault is paranoid.

(Soundbite of laughter)

Mr. DIEM: I will use the word.

BEARDSLEY: Renault plans to launch four new electric car models by 2012 and predicts electric cars will make up 10 percent of the auto market in the next decade.

For NPR news, I'm Eleanor Beardsley in Paris.

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