Home > News list > Tech >> Industry dynamics

Renault's Electric Vehicle Push in China: Navigating Market Slump, Seeking Cost Advantages and Technological Breakthroughs

Industry dynamics 2024-11-29 11:14:48 Source:

Renault's Electric Vehicle Push in China: Navigating Market Slump, Seeking Cost Advantages and Technological BreakthroughsFrench automaker Renault is actively addressing the weakening global demand for electric vehicles (EVs), shifting its strategic focus to expanding its EV business in China to achieve breakthroughs in technology, cost, and production efficiency. This strategic move comes as several automakers, including Stellantis, Volkswagen, and BMW, issue profit warnings primarily attributed to sluggish EV demand, supply chain issues, and declining sales in the Chinese market

Renault's Electric Vehicle Push in China: Navigating Market Slump, Seeking Cost Advantages and Technological Breakthroughs

French automaker Renault is actively addressing the weakening global demand for electric vehicles (EVs), shifting its strategic focus to expanding its EV business in China to achieve breakthroughs in technology, cost, and production efficiency. This strategic move comes as several automakers, including Stellantis, Volkswagen, and BMW, issue profit warnings primarily attributed to sluggish EV demand, supply chain issues, and declining sales in the Chinese market.

Renault

Unlike competitors opting for layoffs and delaying new model launches, Renault has adopted a more proactive approach, aiming to enhance its competitiveness by establishing a research and development center in China and actively seeking local partners.

Insiders reveal that Renault has assembled a team of approximately 200 specialists in Shanghai, primarily focused on hardware engineering for an electric Twingo priced below 20,000 (approximately RMB 150,000). This team is expected to expand to include more software engineers in the future. Francois Provost, Renault's Chief Purchasing, Partnerships & Public Affairs Officer, confirmed in an interview that Renault is actively learning from Chinese counterparts and integrating this knowledge into its teams. He also highlighted that Renault's partnerships in China aim to secure lower-cost, high-quality basic components, an area where European suppliers are relatively lacking in some cases. Provost emphasized that while Renault maintains close collaborations with European suppliers, these suppliers often prioritize higher-margin, higher-value-added components, overlooking the demand for certain basic parts.

Renault's expansion strategy in China has elicited mixed reactions in France. Some unions express discontent with management's cost-cutting and efficiency-enhancing measures, including a controversial limitation of remote work to two and a half days a week. Furthermore, the decision to shift a significant portion of the new Twingo's development to China has drawn internal criticism. Nevertheless, Renault remains committed to its strategic direction. It's noteworthy that Renault has also employed approximately 3,000 engineers in India, further demonstrating its global talent acquisition strategy.

Renault's confirmation of its full-year guidance last month stands out against the backdrop of the current automotive industry downturn. In contrast to competitors experiencing delays in new model launches due to software issues and resorting to layoffs and plant closures, Renault is focusing on its 25,000 city EV, the R5, to boost short-term sales. Further new models are planned for 2025, including an electric revival of the iconic 1960s 4L and the R4, priced below 35,000.

To further reduce costs, Renault plans to upgrade all its EVs (including older models) with more economical lithium iron phosphate (LFP) batteries by early 2026. This is a key element of Renault's strategy to navigate market challenges. While Renault previously planned an IPO for its EV and software division, Ampere, this has been temporarily shelved due to the current weak market demand. However, Ampere remains crucial, aiming to help Renault attract more local partners in China, facilitating better integration into the local market and access to key resources and technologies.

Renault CEO Luca de Meo is committed to producing affordable EVs in France to counter intense market competition and high labor costs. To this end, Renault has modernized its French factories, with the Douai plant in northern France already producing the new R5. These efforts are vital for Renault, especially given the softening relationship with its long-time partner Nissan, whose higher-priced EVs, such as the new Scenic, have underperformed.

Renault's relatively small size, despite the French government holding a 15% stake, has raised concerns about its long-term viability. Provost responded that Renault is accelerating its pursuit of technological components, aiming to match the software and battery competitiveness of locally produced European automakers in China by 2026. This underscores that Renault views the Chinese market as crucial for enhancing its technological and cost competitiveness, expecting to leverage its experience in China to ultimately strengthen its global market position. Renault's strategic deployment not only reflects its emphasis on the Chinese market but also demonstrates its proactive approach and response strategy to the global automotive industry transformation. At its core, the strategy revolves around rapid learning, efficient production, and breakthroughs in cost control and technological innovation to secure a strong foothold in the fiercely competitive electric vehicle market.

Tag: Renault Electric Vehicle Push in China Navigating Market Slump


Disclaimer: The content of this article is sourced from the internet. The copyright of the text, images, and other materials belongs to the original author. The platform reprints the materials for the purpose of conveying more information. The content of the article is for reference and learning only, and should not be used for commercial purposes. If it infringes on your legitimate rights and interests, please contact us promptly and we will handle it as soon as possible! We respect copyright and are committed to protecting it. Thank you for sharing.

AdminSo

http://www.adminso.com

Copyright @ 2007~2024 All Rights Reserved.

Powered By AdminSo

Open your phone and scan the QR code on it to open the mobile version


Scan WeChat QR code

Follow us for more hot news

AdminSo Technical Support