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Renault, Alliance Partners Boost Investment in France

Group invests $1.6B in the country in the past year.

by on Nov.12, 2018

Alliance CEO Carlos Ghosn, left, and French President Emmanuel Macron, center, tour Renault's plant in northern France.

Renault plans to build new Nissan and Mitsubishi vans at plants in France, raising investment in the country as it continues to explore a tighter integration of the three-way carmaking alliance.

The announcement, which timed to coincide with a plant visit by French President Emmanuel Macron, “underlines the importance of France for the alliance,” Renault-Nissan-Mitsubishi said in a statement.

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Renault will build a new Nissan NV250 delivery van at the Maubeuge factory in northern France, which has been hard hit by de-industrialization. The new van will be built on an architecture shared with its own Kangoo model that includes an electric version, the alliance said in a statement.

A larger Mitsubishi van will also be produced in Sandouville, which is in western France, alongside Renault’s Trafic. The move raises Renault’s announced investment in France this year to $1.6 billion, the companies added.

Under pressure from the French government, the carmaker’s biggest shareholder, Renault boss Carlos Ghosn agreed this year to pursue a closer tie-up with Nissan in what is likely to be his last four-year contract as chief executive.

Renault's Maubeuge plant will now build new Nissan and Mitsubishi vans. The move is part of a $1.6 billion investment in French facilities.

(Future of alliance with Nissan/Renault in question as Zetsche readies for retirement. Click Here for the story.)

Renault currently owns 43.4% of Nissan, which in turn holds a non-voting 15% stake in its French parent and 34% of Mitsubishi Motors.

Ghosn has previously said a full merger is possible only if France gives up its ownership stake in Renault — a step the government has been reluctant to entertain without clearer safeguards on French jobs and other industrial interests.

The investment will eventually boost Renault’s sales to partners – one measure of its financial benefit from the alliance – which fell in the last quarter, partly reflecting Europe’s diesel sales decline.

(Click Here for more about Ghosn’s views of a possible Renault take0ver of the Alliance.

France was chosen for the vans investment because “the Maubeuge and Sandouville factories offered the most attractive solution, thanks to their competitiveness,” Ghosn said.

Renault is expanding production and adding employees at its Maubeuge plant.

“Within the alliance, Renault Group’s global expertise in light commercial vehicles generates synergies that benefit all of our customers,” he added.

The new Mitsubishi van will be exported from Sandouville to Australia and New Zealand, under the plans announced on Thursday.

(To see more about Ghosn’s successor plans, Click Here.)

The new Kangoo and Nissan NV250 will bring 200 new jobs and $415 million of additional investment to Maubeuge, in addition to $50 million previously announced for the electric version.

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