France is setting out conditions for the proposed Fiat Chrysler-Renault merger.

We knew this was coming. The government of France has a significant stake in Renault, and anything that dilutes there control over a prestigious French carmaker was bound to bring the government calling for guarantees.

Speaking on RTL Radio, the French finance minister Bruno Le Maire outlined what France would find acceptable in the proposed merger.

"The first: industrial jobs and industrial sites. I told the Renault chairman very clearly that it was the first of the guarantees I wanted from him in the opening of these negotiations. A guarantee on the preservation of industrial jobs and sites in France," said Le Maire, before further demanding that the combined FCA-Renault company also be a world leader on battery-electric vehicles.

Perhaps most importantly, France would demand significant representation on the board of directors for the proposed company. Also, the merger would have to satisfy Renault’s other partners, Nissan and Mitsubishi, in order to move forward.

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That last condition seems more to acknowledge Nissan’s say in the matter. As part of the Renault-Nissan-Mitsubishi alliance, Nissan has a small but significant stake in Renault and is concerned that such a merger would dilute its voice in the global alliance.

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via Renault

To that end, Renault chairman Jean-Dominique Senard flew to Japan on Tuesday to discuss the merger with his Japanese counterparts. Nissan CEO Hiroto Saikawa told Japanese television that his company isn’t necessarily opposed to the idea of bringing FCA into the alliance, “and we are open to constructive discussions."

While France’s demands included guarantees for manufacturing jobs and facilities, a source speaking to Reuters said that no such guarantees were requested for white-collar or engineering positions. The source also notes that while no facilities could close, downsizing of said plants are still on the table if the company wishes to divest themselves of assets.

Negotiations are continuing, but we expect to hear more on this merger over the next week.

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