Groupe Renault Reveals A New Strategy for China

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Not Exactly Amazon Prime, yet. But China will dictate EV sales, service and design standards a the largest EV market in the world.

Groupe Renault unveiled its latest strategy for the Chinese Market in a suburb of Paris, building on two stakes: Electric Vehicles (EV) and Light Commercial Vehicles (LCV). In a way it is more than just an alteration to doing business in the world’s largest vehicle market. It is also a tacit acknowledgement of the success of Chinese industrial policy that dictates local partners, who control the hiring of the workforce. (Groupe Renault Changes Execs – outsider Luca de Meo as CEO, Clotilde Delbos Deputy CEO.   Ghosn Shakeout is Ongoing as Thierry Bolloré, CEO Renault SA, is Fired by the Board of Directors.  FCA Balks at French Government In-Laws. Renault Marriage Off)

Regarding the internal combustion engine (ICE) passenger car, Groupe Renault has entered into a preliminary agreement with Dongfeng Motor Corporation under which Renault transfers its shares to Dongfeng (50% of what was a JV. Renault  now holds a 50% capital in DRAC and JMEV, 49% in RBJAC. eGT capital is 50% Alliance, 50% Dongfeng). DRAC will stop its Renault brand-related activities.

Renault will continue to provide aftersales service for its 300,000 customers through Renault dealers, and also through Alliance synergies. Further development for Renault brand passenger cars will be detailed later within a new mid-term-plan from Renault.

Renault and Dongfeng will continue to cooperate with Nissan on new generation engines with components supplied to DRAC and diesel license to Dongfeng Automobile Co., Ltd. Renault and Dongfeng will also engage in “innovative cooperation” in the field of intelligent connected vehicles.

About Chinese LCV Market

Increasing urbanization, e-commerce extension, inner-city transportation schemes and versatile customer usages are the key characteristics of a rapidly changing LCV market in China as Renault sees it – with no quibbles from AutoInformed based on our time in China. It reached 3.3 million in 2019 and is likely to maintain a healthy upwards path.

Renault Brilliance Jinbei Automotive Co., Ltd. (RBJAC), launched in December 2017, is Groupe Renault’s arm for its LCV business in China. Groupe Renault, of course, is leading the LCV market in Europe in terms of sales volumes for light commercial vehicles, as well as sales of electric light-commercial vehicles. (Group Renault Debuts Hydrogen in Light Commercial Vehicles)

Jinbei is a well-established brand with 1.5 million customers in China and ~ 62,000 sales in 2019. With Renault expertise and technologies, RBJAC is modernizing Jinbei models and extending the line-up with a total of 5 core models by 2023. The joint venture will also export in the future.

About the Chinese EV Market

With 860,000 electric vehicles sold in China in 2019, China is by far the largest EV market in the world. EV sales are expected to reach 25% of the Chinese market by 2030.

Groupe Renault was a pioneer on EV with the Nissan Alliance and has sold close to 270,000 electric vehicles in the world since 2011. It gives a strong competitive advantage in China as shown by the successful launching of, the first joint venture EV car competing in the A segment (sub-compact) with the local automakers.

Groupe Renault says it will reinforce its partnership with Nissan and Dongfeng within eGT to make K-ZE a worldwide car. A derivative for Europe based on “Dacia Spring” concept will be sold from 2021.

JMEV is known as an agile and efficient EV player since its creation in 2015. With Renault support in terms of quality and technologies, JMEV will cover 45% of Chinese EV market in 2022 with 4 core models.

This new China strategy will enhance Renault competitive advantages to sustain long-term presence in the Chinese market and maximize synergies with Nissan under the new Alliance concept of “leader- follower”.

“We are opening a new chapter in China. We will concentrate on electric vehicles and light commercial vehicles, the two main drivers for future clean mobility and more efficiently leverage our relationship with Nissan” said Francois Provost, Chairman of China region of Groupe Renault.

About Groupe Renault

Car manufacturer since 1898, Groupe Renault is an international group present in 134 countries that sold nearly 3.8 million vehicles in 2019. Today it has more than 180,000 employees, 40 manufacturing sites and 12,700 sales outlets worldwide.

To meet the major technological challenges of the future and pursue its strategy of profitable growth, the Group is relying on its international development. It counts on the complementary nature of its five brands (Renault, Dacia, Renault Samsung Motors, Alpine and LADA), the electric vehicle and its unique alliance with Nissan and Mitsubishi Motors.

With a 100% Renault team committed to the Formula 1 World Championship since 2016, the brand is involved in motorsports.

About Groupe Renault in China Now

Renault has 50% capital in DRAC and JMEV, 49% in RBJAC. eGT capital is 50% Alliance, 50% Dongfeng.

 

About Ken Zino

Ken Zino is an auto industry veteran with global experience in print, broadcast and electronic media. He has auto testing, marketing, public relations and communications expertise garnered while working in Asia, Europe and the U.S.
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