Renault to buy out Nissan’s 51 pc stake in Indian JV

French auto major Renault on Monday said it will buy out its Japanese partner Nissan’s 51 per cent stake in their Indian manufacturing joint venture — Renault Nissan Automotive India Private Ltd (RNAIPL) — for an undisclosed amount.

The JV firm operates the alliance’s Chennai-based production facility, which rolls out models for both Renault and Nissan brands.

As part of a global framework agreement signed between Renault Group and Nissan, Renault Group would own 100 per cent of Renault Nissan Automotive India Pvt Ltd (RNAIPL), by acquiring the 51 per cent shareholding currently held by Nissan, Renault said in a statement.

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Renault Group and Nissan have entered into a share purchase agreement to this effect.

The company, however, did not disclose the financial details of the transaction.

The transaction is expected to help Nissan in its turnaround journey with enhanced efficiency and fixed cost management.

Upon the completion of this transaction, Renault Group will own 100 per cent of RNAIPL, it added.

The Chennai plant employs about 6,300 employees and has production capacity of 4.8 lakh units annually.

The agreement includes continuing of the current projects between Renault Group and Nissan, and to define the future relationship of Renault Group and Nissan in India.

Nissan will continue to use RNAIPL for sourcing vehicles for India and for exports in the coming years, the statement said.

Meanwhile, Renault Group and Nissan will continue to operate jointly, Renault Nissan Technology & Business Center India (RNTBCI) in which Nissan will retain its 49 per cent stake and Renault Group will hold its 51 per cent stake.

RNAIPL would continue to produce Nissan models, including the New Nissan Magnite, and will serve as a crucial pillar for the company’s future expansion plans, the company said.

Renault Group CFO Duncan Minto said India is a key market for the expansion of Renault group outside of Europe.

“It’s a strategic part of our international game plan. It’s the third biggest market worldwide, with 4.9 million units per year, offering a huge potential for growth,” he said, acknowledging that the company’s market share in India is just 1 per cent.

The market is expected to expand 30 per cent by 2030 to 6.3 million units, representing about half of the growth globally, outside of the US, China, Latin and Europe, he said.

He noted that the Chennai-based plant benefits from deep and highly competitive supply ecosystem.

“Currently we are producing CMFA and CMFA-plus platforms with Kiger, Triber and Kwid being produced for the Renault brand. It’s going to offer us strong opportunities for further development with the launch of cmfb platform starting next year, with four new models to come under both Renault and Nissan,” Minto said.

He said the Renault Group will leverage the strong Indian automotive ecosystem not only for the development of sales in India, but also for exports in targeted markets.

“It will enable the group to support our ambition for geographical expansion, notably to rebalance the international exposure compared to Europe,” he added.

Under the broad agreement, Renault Group, through Ampere, the first European intelligent EV pure player, would develop and produce a derivative of Twingo, a A-segment vehicle, for Nissan from 2026. This model will be designed by Nissan.

This project represents a key opportunity for Renault to expand its international business, it said, adding that Nissan will maintain its presence in India with a strong focus on increasing market coverage, the statement said.

“As a long-time partner of Nissan within the alliance and as its main shareholder, Renault Group has a strong interest in seeing Nissan turnaround its performance as quickly as possible.

“Pragmatism and business-oriented mindset were at the core of our discussions to identify the most effective ways of supporting their recovery plan while developing value-creating business opportunities for Renault Group,” Renault Group CEO Luca de Meo said.

He further said, “this Framework Agreement, beneficial for both parties, is the proof of the agile and efficient mindset of the new Alliance.”

After the completion of this transaction, RNAIPL would be consolidated at 100 per cent in Renault Group’s consolidated financial statements, the statement said.

Renault said, “2025 is a year of peak investments for RNAIPL, in line with the launch of new vehicles. Thus, the free cash flow impact for the year is expected to be around 200 million euros (taking account of its completion by the end of H1 2025).”

Nissan’s incoming President and CEO Ivan Espinosa said, “We remain committed to the Indian market, delivering vehicles tailored to local consumer needs while ensuring top-notch sales and service for our existing and future customers.”

In a virtual conference call, Nissan India Operations President and Region Divisional Vice President of Business Transformation (AMIEO-Africa, Middle East, India, Europe, Oceania) for Nissan, Frank Torres said the development will help in the company’s turnaround.

Nissan Motor India is on track with plans to triple its domestic and export volumes to 1 lakh each per annum by the end of FY26, he added.

The exit of Nissan from the manufacturing JV will help the company cut down its fixed costs, he said, adding that Nissan remains committed to India, where it has already spent 80 per cent of its announced 700 million euros to bring new models.

“We are here to stay…There is no reason for why Nissan will leave India,” Torres said, adding that three years back there was a discussion on the matter but the company decided to invest in India.

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He also said Nissan is open to outsourcing vehicle manufacturing to other companies in India through a contract manufacturing in future but the current arrangement with Renault will serve its requirements till about 2032.