Diesel Still Vital Role in Renault’s Chinese Strategy

Diesel powertrains will still play a vital role in Renault’s new production and marketing strategy for the Chinese market.

Among its commitment to both BEV and LCV production, the French automaker also stated it will be focusing heavily on diesel vehicle sales in the near to mid-term. Its ICE passenger car strategy includes a preliminary agreement with Dongfeng Motor Corporation under which Renault will transfer its shares in Dongfeng Renault Automotive Company (DRAC) to Dongfeng.

DRAC will stop its Renault brand-related activities but Renault will continue to provide aftersales service for its 300,000 customers through Renault dealers but also through Alliance outlets. Both automakers will continue to cooperate with Nissan on new generation engines like components supply to DRAC and diesel license to Dongfeng. Renault and Dongfeng will also engage in cooperation in the field of intelligent connected vehicles.

Renault’s LCV strategy is being driven by increasing urbanization, the growth of e-commerce, inner-city transportation schemes and versatile needs of customers in China. Total LCV sales reached 3.3M in 2019 and is forecasted to steadily increase.

Renault Brilliance Jinbei Automotive Company (RBJAC), launched in December 2017, is Renault’s production facility for its LCV business in China. Jinbei is a domestic brand with 1.5M customers in China and close to 162,000 sales in 2019. With Renault expertise and technologies, RBJAC is modernizing Jinbei models and extending the line-up with a total of five core models by 2023. The joint venture will also export vehicles to other markets in the future.

In terms of Renault’s BEV market assault, the automaker is hoping to build on the 860,000 EVs sold in China in 2019, which makes the nation the largest EV market in the world. EV sales are expected to reach 25% of the Chinese market by 2030.

Renault expects to reinforce its partnership with Nissan and Dongfeng within eGT to make K-ZE a worldwide car. A derivative for Europe based on “Dacia Spring” concept will be sold from 2021.

“We are opening a new chapter in China. We will concentrate on electric vehicles and light commercial vehicles, the two main drivers for future clean mobility and more efficiently leverage our relationship with Nissan,” said Francois Provost, chairman of China region of Renault.

— Paul Myles is a seasoned automotive journalist based in London. Follow him on Twitter @Paulmyles_