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Renault to produce 7m cars with Nissan and Mitsubishi: Chairman

Jean-Dominique Senard banks on common platforms and electric vehicles

Renault Chairman Jean-Dominique Senard shakes hands with Nissan CEO Makoto Uchida at a meeting of the alliance operating board on Jan. 30, 2020. (Photo courtesy of Renault)

PARIS -- French automaker Renault is beefing up its collaborative efforts with Japan's Nissan Motor and Mitsubishi Motors, with the three-way alliance planning to share the production of major components.

Renault unveiled a midterm strategic plan on Thursday that stresses manufacturing cooperation as well as production cost reductions as it scales back factories.

The French automaker will increase the volume of cars produced with platforms that are shared across the alliance.

"In a very few years, more than 7 million cars in the alliance will be manufactured [from] common platforms, and the commonality of parts is to reach 75-85%," Chairman Jean-Dominique Senard said in an online interview with Nikkei Asia on Thursday.

Renault intends to raise the percentage of common platform production to 80% in 2025 from 39% in 2020.

The alliance last year announced it would ramp up its use of common parts and platforms so as to reduce costs in research and development and in manufacturing.

The alliance in May mapped out how the three partners would collaborate. Each automaker is to focus on its own specialties, then share the results with the other two. "We are achieving our goal and the alliance is at its top," Senard said.

Renault intends for electric vehicles to become a strength.

"It's obvious that electric vehicles will be one of the keys of the future," Senard said. Renault is a leader in Europe's EV market, which last year expanded sharply, driven by government incentives and consumer confidence in environmentally friendly products.

Its flagship Zoe small urban car last year was the region's bestselling electric vehicle. Renault now plans to release the mid-size Megane eVision, which will be built on a common EV platform as soon as 2022.

Renault's flagship Zoe small urban car last year was the bestselling electric vehicle in Europe. (Photo courtesy of Renault)

Senard mentioned the importance of doing business in China, where Renault has been struggling to sell its products for years. "The electric car will be a major support" in gaining ground in the world's largest auto market, the chairman said.

Renault was rather late arriving in China. With state-owned Dongfeng Motor, it opened its first factory there in 2016. It has also partnered with Brilliance China Automotive.

Sales have not been what Renault had hoped. In 2020, it sold 155,728 vehicles in China, representing 0.7% of the market. The number also accounted for 5.3% of Renault's global sales.

Critics say that Renault's small China-built SUV failed to appeal to Chinese consumers, who covet bigger vehicles.

In April, Renault abandoned its partnership with Dongfeng. "It was, I think, a very reasonable decision," Senard said. "But we have not finished our story with China. We strongly believe we will be back in China."

Renault is currently focusing its China efforts on the K-ZE, an electric vehicle, as well as on the production of light commercial vehicles. The French automaker launched the K-ZE in China in 2019, selling 2,658 that year.

Renault also plans to export electric vehicles that it makes in China to Europe under the Dacia brand, its unit based in Romania.

Renault holds 43.4% of Nissan, while Nissan owns 15% of its French partner. Mitsubishi joined the alliance in 2016 upon receiving an investment from Nissan.

Once touted as the most successful auto alliance in history, the tie-up was severely battered in November 2018 by the arrest of Carlos Ghosn by Japanese authorities. At the time, the charismatic Ghosn was Nissan's chairman. He was apprehended at a Tokyo airport on suspicion of financial misconduct, but fled Japan 13 months later in a daring escape. He now lives in exile in Lebanon.

The arrest triggered a bitter management struggle between the French company and its Japanese affiliate that tore at the partnership's health and reputation. Nissan, which produces and sells far more cars than Renault, has strongly opposed a management integration plan raised by the French side -- a topic Senard said the partners were not discussing.

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