Written by / Zhou Zhou
Editor / Liu Baohua
Design / Shi Yuchao
The game and adjustment of the world's largest automobile alliance reached a phased agreement.
On January 30, French automaker Renault said it would reduce its stake in Nissan in the Renault-Nissan-Mitsubishi Motors alliance and agreed that Nissan has voting rights on its board of directors.
Nissan got the equal ownership structure it wanted. Renault, which is spinning off its business and going public, has received support and investment from Nissan in its newly created electric vehicle division.
Both Renault and Nissan, within the framework of the alliance, have gained the greater autonomy they want.
The Franco-Japanese automobile alliance is half a beat slower in the electrification transition.
According to the information disclosed by the two parties, after the alliance "Annei", they will deepen cooperation in the common goal of electrification and automation transformation.
Equal
Under the restructuring agreement, Renault's stake in Nissan will be reduced from 43 percent to 15 percent, with Nissan having voting rights in Renault. This is the same as Nissan's 15% stake in Renault.
Renault intends to transfer the remaining 28 percent of Nissan shares to a French trust company and sell them at the opportune time. These Nissan shares for sale are worth around EUR 3.7 billion.
At the beginning of 2022, Renault and Nissan began negotiations to "reshape the alliance", and after nearly a year of tug-of-war, there were preliminary results: Nissan finally became equal to Renault in the alliance.
In the Renault-Nissan-Mitsubishi relationship, Renault is Nissan's majority shareholder and has voting rights on Nissan's board of directors. Nissan is a major shareholder of Mitsubishi.
In 1999, Renault acquired a 36.8% stake in Nissan, which increased to 44.4% by the end of the year (later dropped to 43.4%), saving Nissan from losing money for seven consecutive years.
The two companies established the Renault-Nissan alliance in October 2001.
Nissan acquired a 15 percent stake in Renault in 2002, but did not have voting rights on Renault's board of directors.
Mitsubishi Motors joined the alliance in 2016 when Nissan acquired a 34 percent stake. In 2017, the Renault-Nissan-Mitsubishi Alliance was officially established, becoming the world's first automotive alliance.
(Image source: Palm Chain Collation)
Under Carlos Ghosn, the league became the world's largest automaker in 2017 with sales of 10.61 million vehicles.
Ghosn is a controversial car boss, becoming CEO of Nissan Motor in 1999 and the ninth CEO of Renault in 2005, holding the position of dual CEO for many years, and Mitsubishi joined the alliance and then became Mitsubishi chairman.
Recently. In November 2018, the soul Ghosn was arrested on charges of concealing income, and the alliance began to deteriorate.
Nissan has long been unhappy with the imbalance in the cross-shareholding structure of the two companies.
In the face of huge investments and transformation pressure from competitors in electrification and cleantech, Renault and Nissan maintained their alliance.
In 2021, Renault and Nissan cross-held shares with Daimler AG respectively.
(Source: Palm Chain Finishing)
Play their proper role
Nissan has always wanted to win an equal shareholding structure.
Under the tough insistence of Nissan CEO Makoto Uchida, Renault is no longer attached to the ownership structure.
(Source: Kazuhiro Nogi/AFP)
In fact, in recent years, Renault has wavered in Nissan's equity advantage. It began looking to partner with more companies, spin off businesses and go public.
Renault's factory in Dieppe▼
(Credit: Sameer Al-Doumy/AFP)
Renault's reason for the concession is that it will receive the following benefits: Nissan agrees and invests in Ampère, its upcoming spin-off and listing company, becoming a strategic investor in the new company, which is expected to hold a 15% stake; Nissan has agreed to spin off Renault's internal combustion engine system business such as engine vehicles and hybrid vehicles (HVs), which will also form a subsidiary, Horse, and a 50:50 flat-share joint venture with China's Geely Automobile, with the possibility of bringing in Saudi Aramco as an investor.
Previously, Nissan expressed concern about the use of joint intellectual property in products supplied by Renault and Geely to China and the United States through a joint venture. This became one of the biggest differences between the two parties in reaching a restructuring agreement.
A few months later, the two sides reached an agreement on the issues that would restrict the new joint venture between Renault and Geely from using intellectual property jointly developed by Renault-Nissan.
According to the Financial Times, the French government, which is a significant shareholder of Renault, with a 15% stake, actively promoted the agreement.
The alliance after equity equality will work together in India, South America and Europe.
Renault, who made huge compromises on paper, actually won more initiative. It is deeply bound to the chain owners of the industry chain to gain stronger competitiveness, such as on November 8, 2022, it won the support of Qualcomm. The San Diego-based chipmaker plans to invest in Ampere and work with Renault to develop a centralized platform architecture for software-defined vehicles.
Both Renault and Nissan need to face the reality of declining sales and transformation breakthroughs.
Not long ago, Renault announced its sales in 2022, with a performance of 1.47 million units, down 9.3% y/y from 1.62 million units in 2021.
Renault said its market share in Europe fell to 6.4 percent, 0.7 percentage points lower than in 2021, although it had stronger performances in Latin America, Turkey and Morocco, with sales up 8 percent, 23 percent and 11 percent, respectively.
Globally, Renault's passenger car deliveries fell by 8.5 percent and light commercial vehicle deliveries by 12.7 percent.
During the same period, Nissan also had a good time, with global sales falling 20.7% y/y to 3,225,549 units.
At the beginning of 2022, the Renault-Nissan-Mitsubishi alliance said it would invest about 20 billion euros (about 143.8 billion yuan) in the next five years to build electric vehicles.
The alliance expects that by 2030, there will be five pure electric sharing platforms to jointly develop more than 30 electric vehicles.
Resources:
1. Renault and Nissan will reach an agreement on the restructuring of the alliance https://www.ft.com/content/7210f6ec-da8f-42e2-9e90-b31bd49c08db
2. Renault agreed to reduce its shareholding, Reached a https://www.bloomberg.com/news/articles/2023-01-30/renault-agrees-to-lower-nissan-stake-in-historic-rebalancing?sref=pr0vRDBl&leadSource=uverify%20wall equity balance with Nissan
This article was originally produced by Automotive Business Review
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