Renault Nissan Alliance

The Paradoxical AllianceRenault-Nissan

Kamran RashidovMeltem Altındağ

Punam Raju KhoklePaola Villanueva

CONTENT• History of Nissan and Renault• Reasons for the Alliance

Definition of Strategic Alliance Renault and Nissan Alliance Objectives of the alliance Advantages

• Key reasons behind the successful Alliance.• Strategic Values of the Alliance.• SWOT Analysis.• Recommendation and Conclusions.

Brief info about Nissan and Renault

• NISSAN Established on December 26, 1933 Headquartered in Yokohama, Japan. Pioneer in the manufacturing of automobiles. Strong market presence in Japan, North America and

Asia. • RENAULT

Established on February 25, 1899 Headquartered in Boulogne- Billancourt, France. Strong distinctive market in Europe and Latin America.

Pessimist Thoughts about alliance

• B. Lutz’s comment.(GM’s vice chairman) • Distant and distinctive national culture,

nationalistic and patriotic cores.• Two mules don’t make a race-horse.• Renault to take 51%, even it means assume

Nissan’s debt.

Strategic Alliance

• Agreement for cooperation among two or more independent firms to work together towards common objectives.

• Not form a new identity to reach their aims but cooperate while remaining apart and distinct.

Renault - Nissan Alliance• Signed in March 27th, 1999• Headquartered in Amsterdam, Netherlands - Central

location• Based on cross-shareholding agreement.• Renault acquire 36.6% stake in Nissan ( 44.4% in

2003)• Nissan take a stake of 15% in Renault

Alliance advantage• Being a complementary in geographic scope and skills

Renault in Europe and Latin America Nissan engineering powerhouse in Japan, North

America and Asia

• 2 Global companies linked by cross –shareholdings

• The Renault-Nissan Alliance is the 4th largest global automaker

• Brands Includes: Dacia, Infiniti, Nissan, Renault and Renault Samsung

• Together, Renault and Nissan ranked as the fourth car group in terms of worldwide sales

• Significant presence in major world markets (United States, Europe, Japan, China, India, Russia)

Alliance advantage

Alliance objectives • Renault

Improve products quality Internationalisation

• Nissan Reduce Debt Reduce Cost

• Common Aims: Economy of Scale (cost reduction thanks to operational

efficiencies and synergies) Entering in emerging markets Technology improvement Sharing risk

Alliance successful Factors• Working step by step.• Six month living experiment before alliance.• Working together without prejudices.• Carlos Ghosn’s role in Nissan Revival Plan. (NRP)

Ghosn became COO of Nissan in July,1999. To prevent misunderstanding; clarified some

terms as “commitment”, “authority”.• Cross-functional teams in Nissan.• Cross-company teams between Renault and Nissan.

Strategic Values of Alliance• Strategic Value for Renault:• Economies of scale • Sharing of best practices• Contribution to net result & dividend flow• Sharing technology

• Strategic Value for Nissan:• Initial financial input from Renault• Re-invention of product • Entering to Europe• Business Development

SWOT Analysis

Recommendation & Conclusion

• Pre- strategy cooperation Alliance.• Work in synergy in a Business Alliance.• Global scale + Local responsiveness BE

TRANSNATIONAL.• Focus on:

Cross - cultural teams.Transfer knowledge (strengths vs weakness).Product differentiation (Global Local).Share resources and technologies.

Recommendations

• Sustain their alliance´s brand name image.• Focus on differentiation product strategy

“Electric cars - Zero Emission”• Standardize a common language.• Build the plants in order to:

Decreased high tariff. Achieve cost reduction Increasing competitive edge.

https://www.youtube.com/watch?v=YppXcl3P274

References

• https://en.wikipedia.org/wiki/Renault%E2%80%93Nissan_Alliance

• blog.alliance-renault-nissan.com.• http://www.tharawat-magazine.com/trendin

g/2224-top-10-largest-car-companies-in-the-world.html?showall=1