The French-Japanese carmaking alliance announced it planned to strengthen synergies in four core divisions and to launch new convergence projects to boost efficiency and revenue.
After eight months of struggle over power throughout last year, the two automakers reached a compromise in December that supposedly balanced the control of the French government within the alliance. And now it is high time to put all this behind, focus on the future and improve the profitability, Carlos Ghosn – CEO of both Nissan and Renault said in a recent statement. “The auto industry is rapidly evolving, requiring Renault and Nissan to leverage the alliance as a pragmatic business tool. The road ahead is one of more convergence, working more closely together,” he added. The alliance is expected to generate 5.5 billion euros (6 billion dollars) of synergies in 2018 by planning to share more resources and to integrate more divisions within the partnership. Such convergence helped Renault and Nissan to raise more than 4 billion euros in annualized synergies in 2015.
During a convention of top executives around the world, Renault-Nissan announced that it is strengthening synergies in Engineering, Manufacturing Engineering and Supply Chain Management, Purchasing, and Human Resources. These functions converged in 2014 and already have Alliance executives managing the units. The two automakers expect to start implementing the cost-saving plan on April 1. Renault and Nissan share an industrial footprint with numerous cross-manufacturing projects in France, South Korea, India and Russia and have a combined annual R&D and capital expenditure fund of 10 billion euros.