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According to the Financial Times, Renault CEO Luca de Meo will hold talks with Nissan CEO Makoto Uchida this weekend to discuss Renault’s plan to sell the internal combustion engine business to Geely Holding, a Chinese automobile manufacturer. According to insiders, Nissan opposes Renault’s plan to sell the internal combustion engine business because it does not want the technology developed jointly with Renault to be shared with a Chinese company. Xiamen China Manufacturer High Quality automated machine manufacturing
Earlier this year, Renault announced that it planned to split its electric vehicle and internal combustion engine businesses into independent departments, including cooperation with other companies, or as an independent listed company, to provide funds for electrification transformation. Since Renault and Nissan share technology, Renault’s plan to split its business needs Nissan’s consent. According to insiders, in return for joining Renault in the development of electric vehicles, Nissan has put forward some requirements, one of which is that Renault should sell at least part of its 43% stake in the Japanese automobile manufacturer, which is a long-term goal of Nissan. According to the Wall Street Journal, executives of the two companies will discuss reducing Renault’s stake in Nissan to 15%.
Renault’s alliance with Nissan dates back to 1999. In 1998, Nissan was deeply involved in the debt crisis due to poor management. Ford and Daimler had intended to buy Nissan but hesitated because they were involved in the debt crisis. Nissan, which had lost money for eight consecutive years, finally turned to Renault for help, hoping to reverse Nissan’s predicament. In exchange, Renault acquired some shares of Nissan, became the largest shareholder of Nissan, and established the Renault Nissan alliance with Nissan.
In 2000, Carlos Ghosn, vice president of Renault, took the post of CEO of Nissan and proposed the “Nissan revival plan”, which led Nissan to turn losses into profits. In 2003, Nissan and Dongfeng established Dongfeng Motor Co., Ltd., which officially entered the Chinese market. Also in this year, Nissan obtained 15% shares of Renault, but the cross equity relationship between Renault and Nissan is not equal. Renault owns 44.4% of Nissan’s equity with voting rights, while Nissan owns only 15% of Renault’s equity without voting rights. Therefore, Renault can influence Nissan’s relevant operations, while Nissan’s influence on Renault’s operations can be almost ignored. Xiamen China Manufacturer High Quality automated machine manufacturing
After Nissan turned losses into profits, Renault again proposed the “108 Plan” for Nissan, that is, to achieve annual sales of 1 million vehicles, zero debt and achieve the highest level of 8% operating profit margin of global auto manufacturers. In 2005, Nissan not only completed the plan, but also continued to increase its sales volume. Under the background of Nissan’s rapid development, the relationship with Renault also gradually intensified. Taking 2011 as an example, Nissan sold 4.67 million vehicles globally, a year-on-year increase of 14.4%, while Renault sold only 2.72 million vehicles globally, a year-on-year increase of 3.6%. However, the inequality in shareholding ratio between partners has damaged Nissan’s interests and started to resist.
In February 2016, Nissan announced at a press conference held in Tokyo that it would buy back some shares from Renault, which was another fight against the unequal relationship between Nissan and Renault. Faced with Nissan’s proposal to buy back its shares, Renault agreed to sell some of its shares in Nissan, but also said that it would ensure that its “internal shareholding ratio in Nissan remains unchanged”. Xiamen China Manufacturer High Quality automated machine manufacturing
Who ever thought that, six years later, Renault has voluntarily given up some shares of Nissan. At present, Renault holds about 40% of Nissan’s shares, but Renault probably will not sell all of its shares, but will reduce the proportion of its shares in Nissan to 15%, and try to achieve a balance of mutual shareholding (15:15). In fact, Renault’s selling of Nissan’s shares is ostensibly to withdraw funds, but the deeper reason is to ease the tense relationship with Nissan.
Renault’s compromise is also for the purpose of electric transformation. In August 2021, Renault and Geely signed a memorandum of understanding. The two sides will establish a long-term strategic partnership to develop hybrid vehicles in the rapidly developing market in China and even the world. In January 2022, Renault and Geely announced that they would, based on Geely’s CMA architecture and hybrid technology, produce and sell Renault branded fuel vehicles and intelligent hybrid vehicles in South Korea and export them to markets outside South Korea. The new car will be produced by the factory in Busan, South Korea, and is expected to be mass produced in 2024. In May 2022, Geely announced at the Hong Kong Stock Exchange that its wholly-owned subsidiary, CIL, and Renault Korea Motors Co., Ltd. had entered into a subscription agreement to subscribe 34.02% of the shares of Renault Motors in Korea for about KRW 264 billion. As part of the transactions to be carried out under the Subscription Agreement, CIL and Renault BV entered into a joint venture agreement to clarify their respective rights and obligations with respect to the Target Company. In addition, Renault plans to separate the internal combustion engine business from the electric vehicle business, while Geely and Saudi Aramco are negotiating to acquire the equity of this internal combustion engine business. Xiamen China Manufacturer High Quality automated machine manufacturing
However, Renault is not developing well in both domestic and global markets. According to EV Sales statistics, in the first half of 2022, BYD ranked first among the global new energy vehicle enterprises in terms of sales volume with 600700 vehicles, followed by Tesla, SAIC GM Wuling, Volkswagen and BMW with 564900, 233000, 158100 and 157000 respectively, while Renault failed to rank in the top 20.
In the domestic market, only “Yi” new energy vehicles are currently on sale. In July 2019, Renault and Jiangling announced the establishment of a joint venture. Renault increased its capital by 1 billion yuan to become the largest shareholder of Jiangling New Energy. The first model, “Yi”, was positioned as a compact pure electric car, which was officially listed on September 26, 2021. After subsidies, the price range was 1398-1998 yuan. As the first pure electric car jointly invested by Jiangling and Renault, “Yi” adopts a new “E” logo and the tail logo is “Renault Jiangling Group”. However, since its launch, this car has been in a state of no interest. The data shows that the cumulative number of Lingyi in Renault River from January to August 2022 is 1575.
Renault’s performance in the new energy vehicle market, whether in the domestic market or the global market, does not seem to have much advantage. Therefore, after accelerating the new energy business with Nissan and Geely, it may be difficult to break through the existing difficulties, but this may be the best way for them to seize the advantages in the new energy field.Xiamen China Manufacturer High Quality automated machine manufacturing.