Carmaker Renault and French unions reach hard-won deal on labor practices, job losses

French carmaker Renault SA says it has reached a potentially groundbreaking deal with leading unions that allows it to reduce its workforce and cut costs in exchange for keeping jobs and production in France.

Renault and other European carmakers have been struggling to stay competitive globally as Europe's car market flails. Rigid labor agreements in France drive up wages and benefits and make it difficult to move jobs elsewhere.

The Renault deal is aimed at providing management more flexibility in staffing as the market evolves.

Renault said in a statement that Chairman Carlos Ghosn signed the deal with representatives of the CFDT, CFE-CGC and FO unions Wednesday.

The French government and big companies in similar straits have been closely watching the Renault negotiations, which took nearly nine months.