Renault could create “separate entities” for electric vehicles and combustion powertrains

PARIS – The Renault group could split its electric and internal combustion transmission activities into two “dedicated entities”, CEO Luca de Meo has said, as the automaker aims for an all-electric range in Europe by 2030.

All-electric activities and technologies would be concentrated in France, while combustion engines, hybrids and transmissions would be built outside the country.

A number of automakers and suppliers are rethinking their internal combustion businesses as the transition to electrification gathers pace in Europe. In a recent case, Mercedes-Benz said it would partner with Geely Holding in China on small engines as it transitions to producing electric motors in Europe.

“We have started to prepare Renault for the transition to a 100% electric mix in Europe by 2030,” CEO Luca de Meo said on Friday. While adoption of electric vehicles is slower than expected, he noted, Renault has a “plan B” with hybrids.

De Meo outlined potential powertrain entities as part of “Chapter 2” of his Renaulution recovery plan, following a return to profitability and cost reduction.

He gave no further details, saying any discussion should be shared with stakeholders.

“We are launching a study right now to see how we could do this,” he said.

Renault currently builds internal combustion engines, transmissions and hybrid drives at several sites in France, including Cléon (3,600 employees) and Ruitz (500 employees) in northern France.

Outside France, Renault builds internal combustion engines and transmissions in Portugal, Romania, Spain and Turkey.

Electrical activities are concentrated in a group of factories in the region, including a planned battery factory with Envision AESC. The Cléon plant, which already manufactures electric motors, is being converted to full production of electric motors.

De Meo said on Friday that the Cléon plant could eventually build 1 million electric motors a year, as early as 2025 or 2026. Renault, which has been building its own electric motors for a decade, recently entered into a partnership with Valeo to develop and build its next generation of engines.

Kevin A. Perras