Automotive allies invest $26 billion in electric vehicles

TOKYO — The Franco-Japanese automotive alliance of Renault and Nissan plans to invest $26 billion in electric vehicle technology over the next five years, the companies said Thursday.

The alliance, which also includes small Japanese automaker Mitsubishi Motors Corp., plans to share research, auto parts and technology to cut costs and produce 35 new electric vehicle models by 2030, aimed at global markets. whole world.

Vehicles will use one of five common platforms, the main parts on which vehicles are built.

Nissan Motor Co. will lead the development of a solid-state battery for electric vehicles, while Renault will lead the development of electronics and software to connect millions of vehicles and provide digital services and features.

“Today, we are lifting the hoods of the alliance together,” said Jean-Dominique Senard, president of the alliance, during an online presentation.

“These are massive investments that none of the three companies could make alone,” he said. He told reporters and analysts the plan makes ties between the companies “completely unbreakable”.

But the model is not without risks. If Renault were to fumble on software, for example, all three companies would suffer. Additionally, the trio still have to compete for key components, including semiconductors.

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Automakers around the world are trying to cut costs and forge alliances. Recent covid-related supply issues hampering production and growing concerns about climate change have made this coordination more urgent than ever.

Tesla has become a powerful and extremely profitable competitor. Other newcomers are entering the market. Sony Corp., which makes the PlayStation video game console, recently showed off a prototype electric car. Japan’s leading automaker Toyota Motor Corp. also announced an aggressive plan for electric vehicles.

Sharing components, production facilities and research will benefit the Renault-Nissan-Mitsubishi alliance, said Makoto Uchida, chief executive of Nissan.

“More than anything, we also benefit from the shared experience and expertise of our employees,” Uchida said.

Renault owns 43.4% of Nissan, while Nissan owns 15% of Renault. Nissan, based in the port city of Yokohama, owns 34% of Tokyo-based Mitsubishi. The French state owns 15% of Renault.

The alliance is the idea of ​​Carlos Ghosn, sent by Renault in 1999 to straighten out a Nissan on the verge of bankruptcy. Ghosn has made it one of the most successful automotive groups in the world. But he was arrested in Japan in 2018 for financial misconduct.

He skipped bail and fled to Lebanon in late 2019. Lebanon does not have an extradition treaty with Japan. Ghosn says he is innocent.

Ghosn’s arrest and related developments strained the alliance, and Senard spoke of a crisis, without going into specifics.

He blamed a “lack of confidence”, which he said was repairing itself.

“That period is a thing of the past,” Senard said.

A lot has changed since Renault and Nissan formed their alliance in 1999. Electric vehicles at the time were a distant prospect, Elon Musk co-founded an online payment company called X.com and China ranked 14th in the world in terms of producing passenger cars, behind Belgium and Mexico.

Since then, Musk has made Tesla the world’s most valuable automaker and made inroads in Europe, where the Model 3 overtook the Renault Zoe as the best-selling electric vehicle last year. Volkswagen and Toyota have planned to spend $170 billion over the next few years to preserve their right to an industry they have dominated for decades. Tech giants including Apple and Google are working on self-driving technology as they try to disrupt the industry.

Information for this article was provided by Yuri Kageyama of The Associated Press and Stefan Nicola of Bloomberg News (WPNS).

FILE – A woman walks past the world headquarters of Nissan Motor Co., Ltd. in Yokohama near Tokyo, Wednesday, May 27, 2020. The Franco-Japanese automotive alliance of Renault and Nissan plans to invest 23 billion euros ($26 billion) in electric vehicle technology over the next five years, the companies announced Thursday, Jan. 27, 2022. (AP Photo/Koji Sasahara, File)

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