Renault's footprint in China will be further contracted and its commercial vehicle joint venture will be restructured

They will also seek to sell cars in South Korea

The Board of Directors of the Company has decided to initiate the reorganization process

Renault and Brilliance's joint venture in China was restructured due to its inability to pay its debts, dealing another blow to the French automaker's already limited presence in the Chinese market.

Renault said on Dec. 22 that the company's board of directors has decided to initiate reorganization proceedings in view of the joint venture's "inability to meet its current financial obligations." The Shenyang-based joint venture, which makes Jinbei-brand vans, was formed in 2017 under then-CEO Carlos Ghosn, with Renault holding 49 percent of the shares.

Prior to this, Brilliance Auto Group had entered the judicial reorganization process after a series of defaults. Renault said the joint venture, renault Brilliance Jinbei Automobile Co., Ltd., continues to see a sharp decline in sales of light commercial vehicles in China.

If the four-year-old joint venture closes, it will be the second time in years that Renault has suffered a setback in the Chinese market. In 2020, the troubled automaker transferred a 50 percent stake in another joint venture to partner Dongfeng Motor, shrinking its already limited China operations.

Renault said at the time that it would focus on vans and electric vehicles in China through other joint ventures. The automaker has also invested in an electric vehicle joint venture with Jiangling Motors.

Renault said on December 22 that despite the strong support of shareholders of both renault Brilliance joint ventures and the implementation of a series of operational improvement measures, China's light commercial vehicle market has tended to weaken, and Renault Brilliance Gold Cup continues to face difficulties.

Distant targets

A spokesman said China's sales in the first 11 months of 2021 fell 35 percent year-on-year to about 16,000 units. Its goal was to sell 150,000 vehicles a year.

Renault closed essentially flat in Paris on Dec. 22, down 18 percent year-to-date.

Renault CEO Luca de Meo has described the automaker's presence in China as almost zero. To reverse that, in August, the company signed a memorandum of understanding with Geely Holdings, China's largest private automotive group, to jointly launch Renault-brand hybrids in China.

They will also seek to sell cars in South Korea. In South Korea, Renault had a joint venture with Samsung for more than 20 years. Written by Tara Patel Editor/Yanbin Feng