Renault-Nissan-Mitsubishi Alliance Revises Cooperation Business Model

The strategic French-Japanese alliance of car manufacturers among Renault, Nissan and Mitsubishi Group will modify the basis of its partnership to support member-company competitiveness and profitability based on each brand's flagship model and geographic leverage, the Renault Group said in a press release on Wednesday

MOSCOW (UrduPoint News / Sputnik - 27th May, 2020) The strategic French-Japanese alliance of car manufacturers among Renault, Nissan and Mitsubishi Group will modify the basis of its partnership to support member-company competitiveness and profitability based on each brand's flagship model and geographic leverage, the Renault Group said in a press release on Wednesday.

"The new business model will enable the Alliance to bring out the most of each company's assets and performing capabilities, while building on their respective cultures and legacies. The three companies of the Alliance will cover all vehicle segments and technologies, across all geographies, for the benefit of every customer, while increasing their respective competitiveness, sustainable profitability and social and environmental responsibility," Jean-Dominique Senard, chairman of the Alliance Operating board and Renault, said, as quoted in the press release.

The new model will have manufacturers adhere to the so-called leader-follower scheme, where each brand will come up with one mother vehicle, or leader car, and sister vehicles in each segment.

The alliance is expected to ensure that leader and follower vehicles for each brand are produced "using the most competitive setup, including grouping production where appropriate."

According to the press release, the alliance has also endorsed the principle of naming different parts of the world as "reference regions," with each company focusing on its core regions to maximize fixed cost-sharing and leverage each company's assets. This will make Nissan the reference for China, North America and Japan; Renault for Europe, Russia, South America and North Africa; and Mitsubishi Motors for ASEAN and Oceania.

The new leader-follower scheme applied within this framework is expected to cover the production of up to 50 percent of the alliance's models by 2025. The scheme itself is expected to deliver model investment reductions of up to 40 percent for vehicles developed and produced within it.