France’s Renault is looking to revive its business in China by forming a hybrid vehicle joint venture with Geely Holding Group, a year after it ended its previous operation in the world’s largest car market.
The two companies have signed a framework agreement to set up the joint venture, which would make and sell Renault-branded petrol-electric hybrid cars in China using Geely’s technologies, supply chains and manufacturing facilities while Renault would focus on sales and marketing.
As part of the partnership, the two car makers also agreed to explore a joint localisation of Geely’s Lynk & Co-brand hybrid vehicles in South Korea where Renault has been manufacturing and selling cars for more than two decades.
The venture would focus on China and South Korea initially but would likely to be expanded to cover fast-growing Asian markets.
Geely and Renault are also looking at co-developing fully electric battery cars.
The new venture is modeled on an EV-focused venture Geely set up in 2019 with Daimler, which plans to manufacture in China and sell Smart-brand EVs based on Geely technology using Daimler’s global sales network.
For Geely, China’s biggest local automaker by sales, the new joint venture would strengthen its strategy to use partnerships with other automakers to share technologies, supply chains and manufacturing, which reduces development costs of EV and other future mobility technology.
For Renault, the partnership would help the French carmaker rebuild its presence in China after it ended a joint venture with Dongfeng Motor Group in 2020.
The proposed Renault-Geely joint venture will be controlled by Geely, with manufacturing in Geely’s existing factories.