Renault SA and Japanese partners Nissan Motor Co and Mitsubishi Motors Corp yesterday unveiled steps to standardize platforms further and push for more joint purchasing to reduce costs, which each company focusing on its strengths.
The measures would help deliver savings of as much as 40 percent in model investments for jointly developed vehicles, the companies said in a statement.
Nissan is to focus on autonomous driving, Renault on the body of electric cars and electric powertrains, and Mitsubishi is to work on plug-in hybrids, they said.
Renault, Nissan and Mitsubishi need each other more than ever now, with the global coronavirus pandemic forcing automakers to shutter showrooms and factories.
The industry is also facing a once-in-a-generation shift to electric vehicles and autonomous driving that will require significant investment in technology and filter out losers and winners.
After coming under strain last year, the partnership is seeking a fresh start, backed by new measures at the companies to improve profitability.
“The new model focuses on efficiency and competitiveness, rather than on volumes,” alliance operating board and Renault chairman Jean-Dominique Senard told an online news conference in Paris.
Nissan is lead efforts in China, North America and Japan, while Renault is to focus on Europe, Russia, South America and North Africa.
Mitsubishi is to continue its efforts in Southeast Asia, where it already has a strong footprint.
In designating the so-called leaders and followers for projects, the partners are tackling one of the prickliest issues they have faced during the past decades: infighting and power struggles between French and Japanese engineering teams. The goal is to have half of the car models in the alliance produced under the new operating model, they said.
Renault is preparing to unveil tomorrow a cost-cutting plan worth 2 billion euros (US$2.2 billion) over three years that is expected to include site closures in France and staff reductions.
Renault has been caught in a political whirlwind this week due to union opposition to shutting factories and talks with the government, its most powerful shareholder, on a 5 billion euro state-backed loan.
Renault is considering shutting an engine and transmission factory in Choisy-le-Roi, France, and is mulling the future of four other production sites, CFDT union spokesman Franck Daout said by telephone on Tuesday following meetings with Senard and French Minister of Finance Bruno Le Maire.
These include Flins, iron foundry Fonderie de Bretagne, a factory in Dieppe and its Maubeuge site.
Le Maire on Tuesday said Flins should not be closed and any plans for Maubeuge need to be closely examined, while acknowledging the company’s manufacturing capacity is twice production levels.
NISSAN’S OWN PLAN
Nissan is due today to announce its own restructuring plan to cut costs by ￥300 billion (US$2.8 billion) and phase out the Datsun brand, a person with knowledge of the matter has said.
Nissan has been in turmoil since the November 2018 arrest of former chairman Carlos Ghosn, with an aging car lineup and management paralysis denting its outlook.
The automaker last month said it expects to post a loss for the latest fiscal year through March.
The Yokohama-based company also plans to shut down one production line in addition to the recently closed operation in Indonesia and reach the reduced spending target this year by cutting marketing, research and other costs, the person said.
Although Nissan is forecasting a 12 percent decline in sales to ￥10.2 trillion for the just-ended fiscal year, the new mid-term plan calls for a return to revenue of ￥11.5 trillion within three years, with fixed costs kept at reduced levels, the person said.
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