Renault SA and Nissan Motor Company charted joint investments in electrification as a faction of a EUR 23 billion (USD 25.76 billion) drive to tie the Franco-Japanese collaboration closer as market competition intensifies.
The carmakers announced the release of the USD 25.76 billion funds in 2021. Renault and Nissan stated on Thursday that the utilization of the fund is for over five years on mutual manufacturing platforms, batteries, and operating systems. Nissan will lead solid-state battery technology development whilst Renault will release a ‘software-defined’ car in three years.
Jean-Dominique Senard, Chairman of Renault, stated that the carmakers had made an investment that none of the three firms could make alone.
Renault and Nissan’s collaboration strategy highlights a step forward in the three-way coalition, including Mitsubishi Motors Corporation. The latter is still striving to refurbish itself after almost falling apart after Carlos Ghosn, its alliance architect and leader. However, competition started rising after Renault and Nissan launched an early electric vehicle trail with their best-selling Zoe and Leaf models.
The collaboration will trickle its number models to 90 from the existing 100 whilst enhancing commonality to over 80% from the current 60% by 2026. By the dusk of the present decade, the collaboration targets to possess 35 electric models with 90% platform commonality.
The collaboration between Renault and Nissan is also brainstorming to reveal a fifth electric vehicle platform, including the four already developed. Parallelly, the next generation of Nissan’s Micra hatchback will be an electric vehicle produced in France, the firms stated.
Road Map to the Nissan – Renault collaboration
The most recent map for the collaboration, which commenced in 1999, focuses on practical ways for the carmakers to pool their resources, even as the imbalance in the cross-stockholding tie-up remains.
Renault possesses a 43% stake in the more prominent Japanese firm with voting rights, whilst Nissan keeps 15% of Renault and has no voting rights. The issue of voting rights is an unresolved source of tension betwixt the collaborators. However, both the firms have stated that their principal focus is making the collaboration work operationally.
Nissan, in November 2021, charted JPY 2 trillion (USD 0.017 trillion) of investment over the next half-decade on electric vehicles and batteries, including 15 new electric models. The acquisition also includes a pilot plant for solid-state batteries in Yokohama.
In June 2021, Renault planned out EUR 10 billion (USD 11.19 billion) electronic vehicle bet on battery supply, fresh models, and powertrains. It brainstorms to introduce ten new battery-powered cars by 2025, including a higher-margin SUV segment.
Nissan and Renault are working on strategies for improvement. The firms have already agreed to supply deals with Envision Group (China). Envision Group extends EUR 2 billion (USD 2.24 billion) on a battery factory near Renault’s auto plant in Douai, France. In addition, the Chinese firm is also investing in the cell making at a Nissan plant in the United Kingdom.
The collaboration last outlined a mutual strategy in May 2020 in a ‘leader-follower- system. The leader-follower system allowed every company within the partnership to take over the driver’s seat in specific regions and technologies and take the back seat in others.
The firms are working hard to keep the collaboration together due to the ongoing pandemic travel restrictions that have majorly prevented top executives from meeting in person. PSA Group, Stellantis NV, and Fiat Chrysler dialled up the pressure.