Tracking the recent profound shifts in the relocation of production by major French automotive groups
Bulletin No. 259, article 3. Since 2018, the contribution of French automotive sector industrial groups to the current account balance of goods has fallen sharply, despite remaining positive (due to the increase in merchanting). Their trade balance registered through French Customs has fallen into deficit, with French automotive groups now importing more manufactured goods from abroad than they manufacture in France for export. This trend reflects an acceleration in the shift of value chains abroad, with assembly plants being developed outside France (mainly in Europe), and a growing dependence on foreign sourced intermediate inputs, particularly from China. This internationalisation by manufacturing on foreign sites has been accompanied by an increase in total exports (customs and merchanting), but a decline in the sector’s trade balance.
1 French industrial groups’ historically positive contribution to France’s balance on trade in goods has gradually centred on merchanting
Since the end of the 2000s, France has been an overall net importer of automotive vehicles. On the one hand, imports have increased, driven by foreign manufacturers penetrating the French market, while on the other, exports have been hampered by the stagnation, and even decline, of automotive manufacturing in France.
Within the automotive sector, for a long time French manufacturers have made a highly positive contribution to France’s trade balance. This article shows that the choices made in terms of the location of their manufacturing have gradually eroded their customs surplus, replacing it with a merchanting surplus.
The balance on trade in goods of France’s large groups continues to show a surplus, despite declining significantly since 2018
In contrast to the country as a whole, large French groups post a largely positive trade in goods balance. Traditionally, until 2018, the main contributors (excluding aerospace and energy) to the trade in goods surplus were large French groups operating in the automotive sector, which generated an annual surplus of around EUR 10 billion. However, their contribution declined sharply between 2019 and 2022 (when it almost disappeared), although a partial recovery was observed in 2023.
To understand these changes, in this article we break down the trade in goods balance of the large groups in the French automotive industry between customs based trade and merchanting. The latter corresponds to the purchase and subsequent re exportation of products manufactured in plants located abroad, which do not physically transit through France: as they do not cross the French border, they are not recorded by customs. Making this distinction allows us to assess the effects of France’s chain of value added being reallocated abroad
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Updated on the 17th of September 2025