Renault-Mercedes Deal for Luxury Car image

Renault SA, which is France’s second-biggest carmaker, is planning to develop a luxury car based on a Mercedes-Benz platform, seeking to expand its offerings in the segment.

The company is already helping Mercedes parent Daimler AG to build the Smart compact car, but is also making researches whether a Mercedes- based luxury model would be a viable product.

“At least one vehicle on a Daimler platform will help us,” Renault Chief Executive Officer Carlos Ghosn declared. “The intention is to say that the exchanges with Daimler are not in one direction. It’s not just Daimler coming and making its little cars, its engines at Renault.”

After Renault managed to outperform Peugeot Citroen with higher earnings and cash flow last year, now plans a new generation of its Espace minivan for 2014, and then a new luxury sedan. Specific details on the new model were not revealed, however, it’s understood the new model could use a Mercedes-Benz platform.

Last month, the two companies announced a new deal concerning Renault and Daimler co-developing four-cylinder engines, which will be used by Renault-Nissan for upcoming Infiniti models and Mercedes will also adapt them to future products.