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Nissan in Negotiations to Invest in Renault's Electric Vehicle Unit

Industry: Future Mobility
Current: ESG

On October 11, 2022, Nissan Motor Co. and Renault announced that they are discussing ways to step up cooperation, including the possibility of Nissan investing in Renault's new electric car subsidiary
People familiar with the matter claimed said in the first week of October 2022 that the two automakers are discussing prospective investment by Nissan as one of the topics as they work to overhaul their more than two-decade-old alliance
According to sources, in exchange for Nissan's participation in the new Renault subsidiary that would house its EV assets, Renault is being asked to give up part of its 43% ownership in the Japanese manufacturer

Nissan Motor Co. and Renault Strengthen Their Collaboration

Nissan Motor Co. and Renault indicated on October 11, 2022, that they are discussing ways to strengthen their collaboration, including the potential of Nissan investing in Renault's new electric car division. Sources said in the first week of October 2022 that the two automakers' discussions on strengthening their more than two-decade-old alliance include the potential investment by Nissan. Nissan has urged Renault to give up part of its 43% investment in the Japanese automaker in exchange for Nissan’s participation in the new subsidiary of Renault that would house its EV assets.

Within the alliance, Nissan is regarded as having an advantage when it comes to EV technology because it has been manufacturing electric cars in large quantities for more than a decade. Nissan has been invited to join Renault's new EV and software-focused subsidiary, which was revealed earlier in 2022. The revenue and net profit of Nissan declined significantly in 2022 in comparison to that in 2021, according to GlobalData.

The number of deals declined in 2022 in comparison to that in 2021, according to GlobalData.

Nissan has long been unhappy with what it perceives to be an unfair relationship with Renault, which, in spite of being the smaller of the two, holds a majority interest in Nissan. These issues could be sorted out with the partial sale of Renault's stock. According to persons familiar with the discussions, senior executives from Renault and Nissan have recently been shuttling between Japan and France to work out the potential acquisition between Renault and Nissan. To strengthen the alliance, Nissan and Renault said on October 11, 2022, that they are also contemplating joint ventures covering markets, products, and technology. However, they did not provide timing or specifics.

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