Renault-Nissan and Daimler have announced a partnership today, in which they will cooperate on future vehicles and technologies.

Renault-Nissan has taken a 3.1% stake in Daimler, while Daimler took a 3.1% stake in Renault and a 3.1% stake in Nissan. However, this isn’t just about stocks. As mentioned earlier, they will be cooperating on future vehicles and technologies.

The next-generation Smart Fortwo, an upcoming four-door Smart, and the next-gen Renault Twingo, will all use the same architecture, jointly developed by Renault-Nissan and Daimler. It is said that they will have unique product designs, meaning that this won’t just be a GM style rebadge. The architecture will use the RWD concept currently used in Smart vehicles, and electric drive is promised right from the launch for all vehicles. These jointly developed models are planned to be released from 2013 onwards. The Smart plant in Hambach, France will produce the two-door vehicles, while the Renault plant in Novo Mesto, Slovenia will be responsible for production of the four-door vehicles.

The partnership will also involve sharing engines. Renault-Nissan will provide 3 and 4 cylinder gasoline and diesel engines to Daimler, which will then be “adapted and modified to reflect Mercedes’ characteristics.” Meanwhile, Daimler will provide Infiniti with various gasoline and diesel engines, including 4 and 6 cylinder gasoline and diesel engines. Not only will they share engines, they will also co-develop engines in the future.

Renault-Nissan and Daimler will also collaborate on light commercial vehicles. Mercedes-Benz will have an entry-level commercial van in its portfolio from 2012, with most of the underpinnings coming from Renault and production taking place at a Renault plant in Maubeuge, France. Also, Renault-Nissan will provide a small diesel engine and transmissions to be placed in the Mercedes Vito.

I’m interested to see what will result from this partnership. They say that the collaborations mentioned are just to start, and that more may come later.

Press Release

Renault-Nissan Alliance and Daimler AG announce wide-ranging strategic cooperation

Brussels, Belgium, Apr 07, 2010

• Cooperation on the next-generation smart fortwo and Renault Twingo, including electric versions, as well as on expanding the smart and Twingo families
• Widespread powertrain sharing and co-development on future projects with applications across passenger cars and light commercial vehicles, specifically:
  • The sharing and co-development of diesel and gasoline engines from the Renault-Nissan Alliance; to be used in the new smart and Renault Twingo and to be adapted and modified with Mercedes-Benz characteristics for its new generation of premium compact cars
  • The sharing of gasoline and diesel engines coming from Daimler to Infiniti, the luxury division of Nissan Motor Company, and providing the opportunity for further collaboration
  • The sharing of a Renault-Nissan Alliance diesel engine and transmission for the Mercedes-Benz Vito
• Collaboration in the field of light commercial vehicles
• One-time cross-shareholding amounting to 3.1% of each partner’s equity capital
• Additional synergies encompassing selective common purchasing opportunities, exchange of operational benchmarks and best practices to be shared across both groups

BRUSSELS, Belgium – The Renault-Nissan Alliance and Daimler AG today announced a broad strategic cooperation that will enable both groups to already realize benefits quickly from a range of concrete projects as well as sharing of best practices. The two groups also announced an equity exchange that will give the Renault-Nissan Alliance a 3.1% stake in Daimler and Daimler a 3.1% in Renault and a 3.1% stake in Nissan.

According toDr. Dieter Zetsche, Chairman of the Board of Management of Daimler AG and head of Mercedes-Benz Cars,“Daimler and the Renault-Nissan Alliance are combining common interests to form a promising foundation for a successful, strategically sound cooperation that is based on a number of very concrete and attractive project cooperations. Our skills complement each other very well.Right away, we are strengthening our competitiveness in the small and compact car segment and are reducing our CO2 footprint – both on a long-term basis.We know that we can make brand-typical products based on shared architectures.The individual brand identities will remain unaffected.”

Carlos Ghosn, Chairman and CEO of the Renault-Nissan Alliance, said: “The Renault-Nissan Alliance knows how to work successfully in collaborative partnerships, and this experience is extremely valuable in today’s and even more tomorrow’s global auto industry. This agreement will extend our strategic collaboration and create lasting value for the Renault-Nissan Alliance and Daimler as we work on broadening and strengthening our product offering, efficiently utilizing all available resources and developing the innovative technologies required in the coming decade.”

Highlights of the Cooperation

Following intensive and productive talks,specific projects have been agreed upon and will be implemented with immediate effect. Specifically:

New common architecture for small vehicles

The successor to the current smart fortwo, a new smart four-seater and the next-generation Renault Twingo will be engineered on the basis of a jointly developed architecture.All vehicles will clearly differ from each other in terms of product design.One main characteristic of the new architecture will be the unique rear wheel drive concept used by current smart vehicles.

The launches of the jointly developed models are planned for 2013 onwards.The smart plant in Hambach, France will be the production location for the two-seater versions, while the Renault plant in Novo Mesto, Slovenia will be the production location for the four-seater versions.Right from its market launch, the jointly developed future models will also be available with an electric drive.

Powertrains

The focus of the cooperation in the powertrain area is on the sharing of highly fuel-efficient, diesel and gasoline engines between the Renault-Nissan Alliance and Daimler.

The Renault-Nissan Alliance will provide 3 and 4 cylinder gasoline and diesel engines out of its portfolio to Daimler, which will then be adapted and modified to reflect Mercedes’ characteristics. The result is a win-win situation for both sides: Daimler will be able to utilize Renault-Nissan Alliance engines and capture additional sales potential for Mercedes-Benz’ future lineup of premium compact cars, while the Renault-Nissan Alliance will improve its capacity utilization.

Daimler will provide gasoline and diesel engines out of its current portfolio to Infiniti. This includes 4 and 6 cylinder gasoline and diesel engines. The result is a win-win situation for both sides: Infiniti will be able to utilize Daimler engines, while Daimler will improve its capacity utilization.

Daimler, Renault and Nissan will also cooperate on future gasoline and diesel engines. Final production decisions for newly, co-developed engines will be taken at a later time, seeking a production network that is well balanced, thus benefiting all sides.

The area of engine cooperation will be driven by a technical concept that ensures the preservation and clear distinctiveness of the individual respective brand and product identities, while at the same time providing a highly competitive cost structure.First,a high level of standardization of the non-brand-relevant components will provide substantial savings for both partners. Second, the use of separate, brand-specific technology packages will ensure that the requirements of the respective brands are met.

Akey objective is to increase competitiveness of all partners through a substantial increase in volumes, leading to economies of scale and cost sharing in development.

Collaboration on light commercial vehicles

The companies have also agreed on a close cooperation in the light commercial vehicle segment.Mercedes-Benz Vans will expand its portfolio to offer an all-new entry-level, intended for commercial usage, from 2012 onwards. The technical basis of this van will come from Renault and will be produced at the Renault plant in Maubeuge, France. Both partners will benefit from higher unit sales, better capacity utilization, shared investment burden, resulting in a better overall cost basis.

In addition to cooperating on small commercial vehicles, selected powertrain components will also be shared to enlarge mid-size van product offering and sales volumes. This includes a small diesel engine and transmissions which Daimler will procure from Renault-Nissan for its mid-size van, the Mercedes-Benz Vito. This additional entry-level motorization will generate additional unit sales for Mercedes-Benz and optimized capacity utilization at Renault.

Equity Exchanges

This strategic cooperation is underscored through a one-time cross-shareholding structure which enables the three companies to exchange, benchmark and create synergies on the basis of a long-term mutually beneficial relationship. The overall construction of the deal is based on the principle of a 3.1/3.1/3.1 percentage cross-holding between Renault, Nissan and Daimler; it will be transacted through an exchange of shares:

• Daimler will get 3.1% of Renault’s newly issued shares;
• Daimler will get from Renault 3.1% of Nissan existing shares;
• Renault will get 3.1% of Daimler shares
• Renault has independently agreed to exchange 1.55% of Daimler with Nissan for 2% of Nissan shares;
• Renault and Nissan will each hold 1.55 % of Daimler treasury shares.

The strategic cooperation will be managed by Renault-Nissan B.V. for the Alliance and Daimler through a new cooperation committee giving representation to all parties. The cooperation committee will be co-chaired by Carlos Ghosn and Dieter Zetsche and steered by senior executives of the three companies.

Further opportunities for collaboration

It is the intention of both groups to create a long-term framework to work closely on future areas of cooperation between Renault, Nissan and Daimler. Each company will pursue future opportunities following the closing of the agreement on the strategic cooperation and the implementation of the first major cooperation projects. These include opportunities to be studied on shared modules and components between Infiniti and Mercedes-Benz vehicles, regional cooperation in the United States, China and Japan between Nissan, Infiniti and Daimler. In addition, opportunities to co-develop technologies relating to electric vehicles and batteries will be explored between Renault, Nissan and Daimler.