China’s Zhejiang Geely Holding Group Co. Ltd has formed a joint venture with Renault Group to sell hybrid cars in China and South Korea
French automobile manufacturer Renault Group has formed a joint venture with China’s largest privately owned automotive group Zhejiang Geely Holding Group Co. Ltd., to sell hybrid cars in China and South Korea.
Hybrid cars are powered by 2 engines of which one is petrol, and one is electric. Both work with each other to spin the wheels. This results in better power and fuel efficiency as they combine the benefits of high fuel efficiency and low emissions.
As per the Memorandum of Understanding (MoU), Renault Group will make and sell petrol-electric hybrid cars in China using Geely’s technologies, supply chains and manufacturing facilities. These cars would be sold under the brand of Renault.
They have also agreed to explore a joint localization of Geely’s Lynk & Co-brand hybrid vehicles in South Korea where Renault has been manufacturing and selling cars for more than two decades.
Making the announcement on twitter, the official twitter handle of Renault Group tweeted,
Geely Holding and Renault Group to sign MOU on joint cooperation in China and South Korean markets ➡️https://t.co/hFdsLqIrVV pic.twitter.com/LtigfL6EmR
— Renault Group (@renaultgroup) August 9, 2021
The new joint venture would also focus on expanding to other Asian markets and would also look at developing full electric battery cars. The new venture is modelled on an EV-focused venture which Geely set up in 2019 with Daimler, which plans to manufacture in China and sell Smart-brand Electric Vehicles (EVs)EVs based on Geely technology using Daimler’s global sales network. However, the Geely-Renault venture would be completely separate from Geely-Daimler venture.
For Geely, the 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. The manufacturing of hybrid cars would be carried out at Geely’s factories. For Renault, the joint venture would help the group rebuild its presence in the Chinese market after it exited the world’s largest car market last year by ending ties with Dongfeng Motor Group.
Renault and its global alliance partner Nissan Motor Co. had the same Chinese partner Dongfeng, before the Renault-Dongfeng joint venture was dissolved. Renault and Nissan also have long designed, produced and marketed cars jointly that share platforms and other vehicle components to reduce manufacturing and other costs.
In the year 2020, when the world was hit by Coronavirus (COVID-19), Renault sold more than 2.9 million vehicles globally and Geely Holding sold more than 2.1 million vehicles, including more than 660,000 Geely-owned Volvo Car.
