Renault and Nissan Revise Alliance Agreement to Support Nissan's Financial Recovery

Renault and Nissan have revised their partnership to reduce cross-shareholdings from 15% to 10% and allow Nissan to exit investments in Renault's electric vehicle development unit. Renault will acquire Nissan's 51% stake in their Indian joint factory and continue to develop an electric version of the Twingo for Nissan to sell in Europe. The changes aim to help Nissan recover from financial difficulties.

Renault and Nissan have announced significant changes to their long-standing partnership, aiming to help Nissan recover from its financial difficulties. The revised agreement includes reducing cross-shareholdings from 15% to 10% and releasing Nissan from its commitment to invest in Renault's electric vehicle development unit, Ampere.

Renault will acquire Nissan's 51% stake in their Indian joint venture, Renault Nissan Automotive India Private Ltd (RNAIPL), and continue to develop an electric version of the Twingo for Nissan to sell in Europe. The changes are part of a broader strategy to make the alliance more flexible and efficient.

Renault CEO Luca de Meo stated, "Renault Group has a strong interest in seeing Nissan turn around its performance as quickly as possible. Pragmatism and a business-oriented mindset were at the core of our discussions to identify the most effective ways of supporting their recovery plan while developing value-creating business opportunities for Renault Group."

Nissan's incoming CEO, Ivan Espinosa, added, "Nissan is committed to preserving the value and benefits of our strategic partnership within the Alliance while implementing turnaround measures to enhance efficiencies. Our goal is to create a more agile and effective business model that allows us to respond quickly to changing market conditions and conserve cash for future investments."

The amended alliance agreement will not impact the additional 18.66% stake in Nissan that Renault holds in a French trust, which does not give Renault voting rights in Nissan. The changes are expected to be subject to customary regulatory approvals and completion by the end of H1 2025.

The revised partnership is part of Nissan's broader turnaround strategy, which includes job cuts and a focus on improving competitiveness. Renault's acquisition of the Indian joint venture and continued development of the Twingo electric model are expected to provide additional opportunities for growth and expansion in the Indian market and Europe.

The changes reflect the evolving dynamics of the automotive industry and the need for strategic partnerships to adapt to changing market conditions. The revised alliance agreement is expected to enhance the financial stability and competitive position of both companies.