Renault has now confirmed that it has launched a strategic review into a spin-off of its electric car business – and provides more details. Specifically, a separate company in France could be dedicated to the development, production and distribution of electric vehicles and software.
This autonomous entity would have a business model adapted to the specificities of electric cars and would be able to enter into partnerships for new technologies and services – at least that is what Renault writes in a statement. At the same time, Renault is also investigating the possibility of bundling its activities with pure combustion and hybrid cars in a separate unit outside France. Both companies could have around 10,000 employees in 2023.
Both companies are likely to remain members of the Renault-Nissan-Mitsubishi alliance, according to current thinking. “The aim of these strategic considerations is to adapt each technology, drawing on the strengths and expertise of the group in its various markets and within the alliance,” it says.
The first reports of such plans came in early April, when top managers such as Chief Executive Officer Luca de Meo and Chief Financial Officer Thierry Pieton were said to have presented the possible plan to analysts. A little later, de Meo confirmed the gist of the rumours.
The move is primarily intended to strengthen the electric car business – by 2030 the Renault brand is to be purely electric in Europe. The French state is known to hold a 15 per cent stake in Renault Group. Thus, it is important that the possible e-car and software company should be located in France, while it is explicitly stated that the combustion engine division should be located outside France. This would also give the e-division access to Renault’s industrial resources in France, such as the eMobility industry cluster ElectriCity in northern France.
As part of its “Renaulution” strategy, the carmaker has started to invest more in electric car supply chains. “Renault Group has taken the strategic decision to locate the production of the main components in the e-mobility value chain in France, demonstrating its determination to develop high-tech activities in high-potential markets and to position itself as a leader in electric cars in Europe,” the group writes.
On the future of the internal combustion division, it says that “given the innovative capabilities and significant improvements in emission reduction of this type of vehicle”, it is convinced that hybrid and plug-in hybrid vehicles “have significant long-term prospects and sales opportunities in Europe and international markets”. The powertrain plants in Spain, Portugal, Turkey, Romania, Brazil, Chile and Argentina are then likely to be added to this division – as are the corresponding development departments in Spain, Romania, Turkey and Brazil.
However, Renault also emphasises that these are still concepts. These are being discussed with employee representatives at the group level and in the countries involved. “The development of these strategic considerations will continue through social dialogue,” the French write.
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