Renault-Nissan Alliance revives with joint projects

Senior executives from the alliance partners held a meeting of the operating board on Thursday, giving the go-ahead to matching the cross-shareholdings of Nissan and Renault, as well as joint ventures as part of changes in cooperation, according to the cited sources.

The partners have also agreed to hold an alliance event on February 6 in London to present details of the plans, added the people, who declined to be identified as the details have not yet been made public.

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According to the plan, Renault will reduce its stake in Nissan from 43% to 15% through an orderly sale of shares over time to remove imbalanced capital linkages that have been a source of friction for years.

The interim deal follows years of tensions that at one point spilled over into Franco-Japanese politics when then-Renault-Nissan leader Carlos Ghosn considered merging the two companies.

The partners also agreed to continue collaborating on various industrial projects, a crucial condition for Renault to win approval for the rebalancing from its most powerful shareholder, the French government.

Communications representatives for Renault and Nissan declined to comment. The boards of the respective companies will have to approve the deal in meetings to be held in the coming days, the people said.

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complex division

The redesigned alliance will allow chief executive Luca de Meo to push ahead with a complex division of Renault into five separate businesses, including the Ampere electric vehicle business, and deepen ties with a number of other partners, including China’s Zhejiang Geely Holding Co. and Qualcomm Inc., the people said.

Renault, Nissan and their junior partner Mitsubishi Motors Corp. will initially embark on about five projects, codenamed “reloaded” (recharged), which will be followed by others, according to the people quoted.

One of them will take place in India, where the companies have a plant on the outskirts of Chennai to make small vehicles, engines and gearboxes, and another to work together on commercial vehicles. Closer collaboration is also expected in Latin America, according to another source.

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In addition, Nissan also plans to invest in Renault’s Ampere. Renault has proposed working on 10 projects, the people added.

The desire to advance specific common activities as part of the tripartite pact indicates that the companies see a joint future for an alliance that had to rebuild after Ghosn’s arrest in 2018.

Renault-Nissan cannot afford to waste synergies in the increasingly competitive transition to electric vehicles. The sweeping agreement comes after months of tense negotiations to salvage a 23-year-old alliance, whose talks nearly collapsed late last year.