Renault ends common purchasing agreement with Nissan

Renault ends common purchasing agreement with Nissan

Automotive News Europe — 2023-09-26

Automotive Industry

Renault is ending its common purchasing agreements with alliance partners Nissan and Mitsubishi with a view to having a more agile structure that can make decisions more quickly.

The move is aimed at better adapting to automotive markets that are becoming more regional due to differences in regulations, such as over electrification and connectivity, Renault said.

By the end of 2023, the alliance's purchasing organization "will transit from a standardized global model towards a project‑driven cooperation," Renault said in a statement on Tuesday.

"The leading company of a given project will have the autonomy to define the specifications and processes to match the product requirements of each company while complying with regulations for the related region," Renault said.

The new structure will ensure "quicker decisions and operational efficiencies along several dimensions: markets, technologies, vehicles and beyond, to support the implementation of the Alliance common projects for Europe, Latin America, and India," the statement said.

The new structure "will leverage each partner's geographical strengths, technical resources, and market expertise to support their respective strategic plans," the statement added.

Renault and Nissan finalized at the end of July the terms of a restructured alliance after months of negotiations.

Talks dragged on months longer than expected due in part to Nissan, which was concerned about protecting its intellectual property in future collaborations.

The July agreement freed both companies to focus on the more pressing problem of navigating the fast-changing industry landscape.

For Nissan, that means contending with an increasingly grim outlook for foreign automakers in China, the world's biggest car market, while Renault is focusing on creating a separate electric vehicle business called Ampere.