Renault in talks over new alliance body with Nissan and Mitsubishi

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Renault in talks over new alliance body with Nissan and Mitsubishi

Renault said on March 11 that it was in talks with its Japanese partners Nissan and Mitsubishi Motor over a new alliance body for the three companies.

Monday, March 11, 2019 —

French carmaker Renault said on March 11 that it was in talks with its Japanese partners Nissan and Mitsubishi Motor over a new alliance body for the three companies.

“In response to recent press reports, Renault confirms that it is in discussions with its Alliance partners Nissan Motor Co., Ltd. and Mitsubishi Motor Co., Ltd. regarding the establishment of a new Alliance body in order to enhance and ensure further collaboration,” Renault said in a statement.

“The proposed arrangement will have no impact on the existence of the RAMA (Restated Alliance Master Agreement), and the cross-shareholding structure, which will both remain in place,” added Renault.

Earlier Renault–Nissan–Mitsubishi Alliance

The Renault–Nissan–Mitsubishi Alliance is a Franco-Japanese strategic partnership between the automobile manufacturers Renault (based in Paris, France), Nissan (based in Yokohama, Japan) and Mitsubishi Motors (based in Tokyo, Japan), which together sell more than 1 in 9 vehicles worldwide. Originally known as the Renault–Nissan Alliance, Renault and Nissan became strategic partners in 1999 and have nearly 450,000 employees and control ten major brands: RenaultNissanMitsubishiInfinitiRenault Samsung MotorsDaciaAlpineDatsunVenucia and Lada. The car group sold 10.6 million vehicles worldwide in 2017, making it the leading vehicle manufacturer in the world. The Alliance adopted its current name in September 2017, one year after Nissan acquired a controlling interest in Mitsubishi and subsequently making Mitsubishi an equal partner in the Alliance.

The strategic partnership between Renault, Nissan and Mitsubishi is not a merger or an acquisition. The three companies are joined together through a cross-sharing agreement. The structure was unique in the auto industry during the 1990s consolidation trend and later served as a model for General Motors and the PSA Group, and Mitsubishi, as well as Volkswagen and Suzuki, though the latter combination failed. The Alliance itself has broadened its scope substantially, forming additional partnerships with automakers including Germany’s Daimler, China’s Dongfeng and Russia’s AvtoVAZ.

Following the November 2018 arrest and imprisonment of Alliance chairman and CEO Carlos Ghosn, accompanied by his dismissal from both Nissan and Mitsubishi, press analysts have questioned both the stability of the Alliance’s shareholding agreement and its long-term existence. These analysts also note that, because the companies’ recent business strategies are interdependent, attempts to restructure the Alliance could be counter-productive for all of the members.

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