Renault joins with Geely to drive hybrid sales in China
RENAULT is joining forces with Chinese automotive giant Geely to sell hybrid vehicles as the French company tries to re-establish a foothold in the world’s largest car market.
The companies will sell Renaultbranded hybrid vehicles in China, and the deal also targets other fast-growing south-east Asian markets.
Introducing cars in South Korea based on Geely’s Lynk & Co vehicle platforms is being considered, taking advantage of Renault’s long-term relationship with local technology company Samsung in the country.
Renault abandoned a partnership with Chinese manufacturer Dongfeng last year after several years of losses.
However, the French company cannot ignore the Chinese market, where more than 25m vehicles were sold last year, making it a third larger than the next biggest market, the United States. The tie-up will allow Renault and Geely, which owns brands including Volvo and Lotus, to share resources and technology, cutting development costs.
It is Renault’s first move since Weiming Soh, a former senior VW executive, became its China boss earlier this year.
Last month, Luca de Meo, the Renault chief executive, said the company was “almost nowhere” in China because of the change of strategy and new focus on commercial vehicles in the region.
“A global brand like Renault, without a presence in China, is not an acceptable concept,” he told Bloomberg TV.
“We have to find a way to get back in a different way with a proposition that is more progressive and adding something to the equation.”
In the first six months of the year, only about 7pc of Renault’s global sales were in the key Asia-pacific region.
This equates to about 100,000 vehicles, a level that was static on the previous period in a market that grew by more than a quarter.
China has some of the world’s strictest rules regarding the production of greenhouse gas-emitting vehicles as it battles unhealthy levels of air pollution in its crowded cities.
Toyota and Honda have long been developing and making hybrid cars but Chinese rivals such as Geely and Great Wall are now following suit.