The Renault-Nissan-Mitsubishi Alliance has announced a groundbreaking new phase in their 24-year partnership, designed to drive enhanced value creation and strategic agility for all stakeholders. Following approvals from the Boards of Directors of Renault Group and Nissan Motor Co., Ltd., the Alliance unveiled a comprehensive three-dimensional program poised to reshape their collaboration and secure future growth in the rapidly evolving automotive landscape.
This ambitious initiative encompasses high-value operational projects spanning Latin America, India, and Europe, alongside enhanced strategic flexibility enabling partners to participate in new ventures. Crucially, the agreement includes a rebalancing of the Renault Group-Nissan cross-shareholding structure, coupled with reinforced Alliance governance, setting the stage for a more effective and future-proof partnership.
A binding framework agreement has been established, with definitive agreements anticipated by the end of the first quarter of 2023. The completion of these transactions, subject to standard regulatory approvals, is projected for the fourth quarter of 2023. This transformative program signifies a renewal and strengthening of the long-standing alliance, fostering a dynamic spirit and leveraging the cutting-edge technologies across all three member companies. This next chapter promises to unlock expanded growth opportunities and ensure operational efficiencies for each entity within the Alliance, empowering them to innovate and adapt within the dynamic market of automotive products and mobility services.
Detailed specifics of the binding framework agreement were shared during a joint conference held in London earlier today.
High-Value Operational Projects: Driving Synergies Across Continents
Building upon the Alliance roadmap defined towards 2030, the companies are actively exploring key projects across Latin America, India, and Europe. These initiatives are strategically designed to deliver mutually beneficial, large-scale, and actionable advantages for all Alliance members, focusing on markets, vehicles, and technologies. Each company is poised to reap mid-term benefits from these value-generating projects, while also realizing immediate gains through cost sharing and avoidance.
Latin America: Expanding Market Reach and Production Footprint
In Latin America, four significant projects are under consideration:
- New Half-Ton Pickup Truck: Renault Group will spearhead the development of a new half-ton pickup, which will be shared with Nissan in Argentina, expanding both brands’ presence in this crucial segment.
- Continued Collaboration on One-Ton Pickups: The successful partnership on the Nissan Frontier/Renault Alaskan one-ton pickup family will be extended. Renault Group will continue production in Cordoba, Argentina, for both Renault and Nissan, leveraging established efficiencies.
- Renault Vehicle Production in Mexico: Nissan will undertake the production of a new model for Renault Group in Mexico. This marks a significant milestone, representing the first Renault vehicle to be manufactured in Mexico in two decades, optimizing Nissan’s manufacturing capabilities in the region.
- Common A-Segment Electric Vehicles: Nissan and Renault Group are exploring the commercialization of two common, accessible A-segment Electric Vehicles. Both models will be based on the CMF-AEV (Common Module Family) platform, accelerating the rollout of affordable EVs in the region.
India: Developing SUVs and Exploring EV Opportunities
For the burgeoning Indian market and export opportunities, Renault Group and Nissan are set to collaborate on several new vehicle projects:
- Shared SUVs: The collaboration will encompass new SUVs that will be shared by both Renault Group and Nissan, capitalizing on the growing demand for SUVs in India and global markets.
- New Nissan Car Based on Renault Triber: A new Nissan car will be derived from the Renault Triber, leveraging Renault’s existing platform and market knowledge to quickly introduce a new Nissan model tailored for the Indian consumer.
- Common A-Segment Electric Vehicles (India): Mirroring the Latin American strategy, Nissan and Renault Group are also considering common A-segment electric vehicles for the Indian market, aiming to democratize EV adoption in this rapidly expanding market.
Europe: Focusing on Electrification and Next-Gen Technologies
The companies are exploring several key initiatives in Europe, with a strong emphasis on electrification and advanced technologies:
- New Mitsubishi Models Based on Renault Platforms: Renault Group and Mitsubishi Motors will leverage the proven assets of the Renault Captur and Clio to develop two new vehicles. The next-generation ASX and Colt for Mitsubishi will be based on the CMF-B platform, streamlining development and time-to-market.
- Renault FlexEVan and Sharing with Nissan: Renault Group will introduce the FlexEVan to the LCV (Light Commercial Vehicle) market as its inaugural Software-Defined Vehicle from 2026. This innovative vehicle will be shared with Nissan in Europe, showcasing Renault’s technological advancements and offering Nissan a cutting-edge LCV solution.
- Collaboration on Next-Generation C-Segment EVs: Looking beyond 2026, Nissan and Renault Group are exploring potential collaborations on the next generation of C-segment Electric Vehicles. To ensure industry-leading charging times, the companies will continue to share technologies for their European vehicles, potentially including the adoption of a common 800-volt architecture.
- Nissan Compact EV Production at Renault ElectriCity: These new initiatives will build upon existing commitments, including plans for the future Nissan compact Electric Vehicle (B-segment), based on the CMF-BEV platform, to be produced at Renault Group’s ElectriCity facility in France starting in 2026, highlighting the geographic and manufacturing synergies.
Beyond Vehicles: Expanding Cooperation Across the Automotive Lifecycle
In Europe, the scope of collaboration extends beyond vehicle development to encompass the entire lifecycle, from distribution to usage, recycling, and end-of-life management.
- Distribution, Aftersales & Sales Financing: Renault Group, Nissan, and Mitsubishi Motors are actively pursuing shared opportunities within the distribution network. This aims to bolster dealer profitability and reduce costs through:
- Increased Shared Outlets: Expanding the number of shared dealerships in key markets to optimize network coverage and resource utilization.
- Common Strategies for Used Cars, Aftersales, and Sales Financing: Developing unified strategies for used car management, aftersales services, and sales financing, leveraging the strong presence of Mobilize Financial Services in Europe to enhance customer offerings and financial performance.
- Electric Vehicle (EV) Charging Infrastructure: Renault Group and Nissan are exploring the joint deployment of EV charging infrastructure across Europe, specifically at both Renault Group and Nissan dealerships (charging@dealer). This initiative will enhance the EV ownership experience and support the growing EV market.
- Circular Economy and Battery Recycling: Renault Group and Nissan are planning to select common battery recycling partners for their end-of-life batteries and production scraps. This commitment to a circular economy approach will ensure responsible resource management and contribute to sustainability goals.
Enhanced Strategic Agility: Fostering Innovation and Investment
In the second pillar of enhanced cooperation, all three Alliance companies have agreed to explore their respective strategies in electrification and low-emission technologies. This involves strategic investments and collaborations in member-company projects that can deliver incremental value to each individual business, promoting innovation and shared growth.
These agile strategic initiatives are designed to complement the existing business plans of each member company, including Nissan Ambition 2030 and Renaulution. By leveraging commonality and investment opportunities, each business can effectively pursue their distinct goals for sustainable growth and decarbonization targets.
Key areas of collaboration under consideration include:
- Nissan Investment in Ampere (Renault Group’s EV & Software Entity): Nissan intends to invest up to 15% in Ampere, Renault Group’s EV & Software entity in Europe, with the strategic objective of becoming a key investor. This intended investment will significantly enhance and accelerate new business opportunities for Nissan within the European EV market and software ecosystem.
- Mitsubishi Motors Considering Investment in Ampere: Mitsubishi Motors is also considering investing in Ampere, further strengthening the collaborative approach to electrification and software development within the Alliance.
- Nissan and Mitsubishi Motors as Customers of Renault Group’s Horse Project: Nissan and Mitsubishi Motors are poised to become customers of Renault Group’s Horse project. This initiative is focused on achieving greater scale and market coverage for low-emission internal combustion engine (ICE) & hybrid powertrain technologies, offering Nissan and Mitsubishi access to advanced powertrain solutions.
These strategic initiatives will complement ongoing technology collaborations in critical areas such as All Solid-State Battery (ASSB) development, Software-Defined Vehicle (SDV) technologies, and Advanced Driver Assistance Systems (ADAS) & autonomous driving, ensuring the Alliance remains at the forefront of automotive innovation.
Rebalanced Cross-Shareholding and Reinforced Governance: A Foundation for Future Success
As each Alliance member company progresses with its individual business plans, establishing a revised cross-shareholding structure and governance framework aligned with the objectives of the next-generation Alliance has been deemed essential. While previous Alliance agreements have facilitated strategic execution over the past 24 years, a modernized approach is necessary to optimally position the Alliance members for future industry opportunities and challenges.
Renault Group and Nissan, as the founding members of the Alliance, have reached an agreement to rebalance their cross-shareholding and governance terms. This strategic realignment is designed to ensure enhanced effectiveness and maximize value creation for all parties.
A binding framework agreement outlines the principles of a new governance structure and the rebalancing of cross-shareholdings between Renault Group and Nissan. The two companies plan to formalize a new Alliance agreement by March 31, 2023, which will supersede the existing agreements governing the Alliance, including the Restated Alliance Master Agreement, the Alliance Equity Participation Agreement, and the Memorandum of Understanding of March 12, 2019.
This new Alliance agreement is intended to be in place for an initial period of 15 years, providing long-term stability and a clear framework for continued collaboration.
Key Elements of the Rebalanced Cross-Shareholdings:
- Retained Cross-Shareholding: Nissan and Renault Group will each maintain a 15% cross-shareholding, demonstrating continued commitment to the partnership. This will include a lock-up obligation and a standstill obligation, ensuring stability and mutual long-term commitment.
- Renault Group Transfer of Nissan Shares to a French Trust: Renault Group will transfer 28.4% of Nissan shares into a French trust. These entrusted shares will be voted neutrally, except in specific, limited circumstances:
- Election/Dismissal of Renault Nominated Directors: The trustee will vote as directed by Renault in matters concerning the election or dismissal of directors of Nissan nominated by Renault.
- Election/Dismissal of Directors Nominated by Nissan Nomination Committee (excluding Renault Nominees): The trustee will vote in favor of decisions and proposals from the Nissan Nomination Committee regarding the election or dismissal of directors not nominated by Renault.
- Shareholder Proposals Not Supported by Nissan Board: The trustee will abstain from voting on shareholder proposals not endorsed by the Nissan board of directors, ensuring alignment with Nissan’s strategic direction.
- Continued Economic Rights for Renault Group: Renault Group will retain full economic rights, including dividends and share sale proceeds, from the entrusted shares until they are sold, ensuring no immediate financial impact from the transfer. The transfer to the trust will not trigger any impairment in Renault Group’s financial statements.
- Nissan Exercising Voting Rights in Renault Group: As a result of the transfer of 28.4% of Nissan shares to the trust, Nissan will gain the ability to exercise its voting rights associated with its shareholding in Renault Group, establishing greater parity in governance.
- Capped Voting Rights: The voting rights of both Renault Group and Nissan will be capped at 15% of the exercisable voting rights. Both companies will have the autonomy to freely exercise their voting rights within this limit, ensuring a balanced governance structure.
- Renault Group Flexibility to Sell Entrusted Nissan Shares: Renault Group will have the flexibility to instruct the trustee to sell the entrusted Nissan shares when commercially reasonable for Renault Group. However, there is no obligation to sell these shares within a pre-determined timeframe, allowing for strategic decision-making.
- Nissan Right of First Offer: Renault Group will have full flexibility to sell the Nissan shares held in the trust, but within a coordinated and orderly process with Nissan. Nissan will benefit from a right of first offer, either for itself or for a designated third party, providing Nissan with strategic options regarding the future ownership of these shares.
Enhanced Voting Rights & Governance Structure:
- Termination of Governance Agreement with French State: The governance agreement entered into on February 4, 2016, between Renault Group and the French State related to its shareholding in Renault Group will be terminated. This will empower the French State to freely exercise all its voting rights in Renault Group, simplifying the governance structure.
- Board Representation: Renault Group will continue to nominate two representatives to Nissan’s board of directors, and Nissan will retain the right to nominate two representatives to Renault Group’s Board, ensuring continued cross-representation and collaboration at the highest levels of governance.
- Alliance Operating Board Continuity: The Alliance Operating Board will remain the central coordination forum for Renault Group, Nissan, and Mitsubishi Motors, ensuring ongoing operational alignment and strategic coordination across the three companies.
This comprehensive set of initiatives marks a significant step forward for the Renault-Nissan-Mitsubishi Alliance. By focusing on high-value projects, enhancing strategic agility, and establishing a more balanced governance structure, the Alliance is well-positioned to navigate the evolving automotive landscape and drive sustained success for all its members.
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