Renault-Nissan-Mitsubishi Increases Earnings from Annual Synergies to 5,7 Billion Euros

Renault - Nissan - Mitsubishi; Today, as the largest automotive alliance in the world, it announced that the joint revenue from annual synergies rose by 2016% from 5 billion Euros to 5,7 billion Euros in 14. Cost savings, rising incomes and cost aversion were effective in this.

The latest synergies reflecting economies of scale carried out by Alliance members revealed that 2017 sold more than 1 million vehicles for the 10,6 year. The Alliance has become the world's largest car group in terms of passenger cars and light commercial vehicles.

Renault-Nissan-Mitsubishi President Carlos Ghosn said: “The Alliance had a direct positive impact on the growth and profit of each member company. In 2017, the Alliance greatly improved the performance of all three companies, including Mitsubishi Motors, which earned the revenue of its first full synergy year. The Alliance accelerates unification thanks to the increased use of shared facilities and common vehicle platforms, sharing technology, and coexistence in both mature and developing markets. Therefore, we hope to increase our synergies in the coming years. By the end of 2022, we are reinforcing our synergy target of more than 10 billion Euros. ”

The Alliance envisages that more than 2022 million vehicles will be sold by the end of 14 under the medium-term plan of the cooperation. The construction of 9 million vehicles from these vehicles, including electric vehicles and segment B vehicles, will be carried out on four common platforms, and the use of common powertrains will be increased from one third to 75% of the total.

Alliance member companies share R & D costs and investments through a unified engineering function, which increases their competitiveness. For example, Nissan and Mitsubishi Motors developed their new generation of Kei cars last year.

In the 2017, the Alliance Purchasing Organization (formerly the RNPO - the Alliance's Purchasing Organization) provided significant savings and reduced savings, thanks to centralized parts, equipment and vehicle procurement, global contract negotiations, and the provision of joint utilities at facilities worldwide.

Examples of new synergy include:

Mitsubishi Motors utilizing the opportunities of Nissan Sales Finance and Renault RCI Bank and Services;
Comparative evaluation between Nissan and Mitsubishi Motors in the Union of Southeast Asian Countries;
Spare parts warehouses shared between Renault, Nissan and Mitsubishi Motors in Europe, Japan and Australia.

In addition, synergies that continue in the field of production are also outside of vehicle production on shared platforms such as Datsun Redi-Go and Renault Kwid; It was carried out by cross-production methods such as Renault Alaskan production at Nissan plants located in Barcelona, ​​Mexico, Cuernavaca and Spain. Nissan and Mitsubishi Motors companies combined the shipments of completed vehicles from their facilities in Thailand to their respective vendors, so the costs associated with vehicle transportation decreased significantly in 2017.

As a result of the creation of a unified business unit for light commercial vehicles in 2017, cross development and cross-production were maximized, and synergies were achieved in Renault and Daimler's costs and technology for vehicles such as the Nissan platform-based, one-ton pickup truck. This allowed the collaboration to expand the market coverage by 18% across Renault, Nissan and Mitsubishi Motors with a total of 77 models.

"More comprehensive mergers and increased synergies will strengthen the Alliance's sustainability in the long term," said Ghosn.

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