The French government has told Renault and Peugeot Citroen to stop trading with US car parts firm Molex after it refused to pay for a redundancy scheme at a French plant despite making record profits.

Industry minister Christian Estrosi described the firm's refusal to make redundancy payments while turning a profit as "scandalous". 

He added: "The announcement that Molex made US$75m profit, of which 15% will be paid to shareholders, shows the most contemptible behaviour, towards Molex employees as well as the French government and French justice.

"I have asked Renault and PSA (Peugeot Citroen) to terminate all orders with Molex and for there to be no more commercial exchange between them.”

The French government holds 15% stake in Renault, making it the biggest single shareholder. PSA Peugeot Citroen is an entirely private company.

Molex's electrical connectors plant in southern Villemur-sur-Tarn was closed in October 2009 after an 11 month struggle by workers to keep the factory running.

The company decided to let the French state finance the planned redundancy scheme after 188 of 283 employees sought to take the company, headquartered in Lisle, Illinois, to an industrial tribunal.

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