Nissan, Renault kick off talks for the Alliance’s future

Nissan and Renault, partners in an Alliance now in its 22 year, and which dominated auto news in the pre-Covid era, has kicked off talks that will determine the future of one of the world’s most ambitious alliances.

In a statement on its website, Nissan Motor company said:

Renault Group and Nissan Motor Co., Ltd. are currently engaged in trustful discussions around several initiatives as part of continued efforts to reinforce the cooperation and the future of the Alliance.

The discussions include:

• An agreement on a set of strategic common initiatives across markets, products, and technologies.
• Nissan's consideration to invest in the new Renault EV entity which will support Renault's Renaulution strategy and will be one of the strategic steps towards Nissan Ambition 2030.
• The companies continue to drive structural improvements to ensure sustainable Alliance operations and governance.

The Alliance was set up in 1999 and began its India operations in 2010. The Renault Kwid made at the company’s plant at Oragadam was a hit of sorts and provided an alternative offering to the reigning small car company, Maruti which had a portfolio of hatchbacks. It got off to a great start with over 100,000 units sold but never really dislodged the Alto. The Alliance subsequently rolled out more models with the more recent offerings such as the Triber and Pulse enjoying a good connect with the buyer in recent years even as the Duster didn’t have a great run.

Earlier this year, Renault-Nissan-Mitsubishi announced the  2030 roadmap that focused on pure electric vehicles and connected mobility.

Nissan’s Magnite has delivered decent numbers of the Alliance even as the Datsun range didn’t quite take off, and exited India earlier this year. The Alliance’s plant in India catered to both domestic and international markets and developed into India's second largest car exporter with more than 600,000 units shipped to 106 countries since 2010.

The global industry will watch very carefully what both partners – Renault and Nissan -- decide as the auto sector makes a transition to electric mobility. Nissan’s bestselling EV is the Leaf, and at one point in time, the company was planning to bring it into India but the pandemic led to plans being put on hold.

A lot has happened with the Carlos Ghosn era coming to an end with this arrest and subsequent dramatic exit from imprisonment in Japan, Ghosn was the architect of an alliance that went on to become a leading automotive group. Ghosn’s personality was in a sense, larger than life, and his presence and influence was strong. But the Alliance had many underlying tensions that came to the fore with Ghosn’s ouster for alleged financial irregularities.

Ghosn who visited India several times was also impressed by India’s frugal engineering and at one point, was keen to tie up with Bajaj Auto on what was called the ULCC or Ultra low cost car. However, that did not work as per plan and the Alliance reportedly lost interest.

It remains to be seen what new objectives will be laid out and India’s role in it. India’s role in EVs both as an ecosystem may be part of the framework given the fact that India’s EV start-ups are playing a key role in the company’s transition to electric mobility.