German automaker Daimler AG, France's Renault SA and Japan's Nissan Motor Co. are teaming up to develop future small cars, including the next generation of the thermoplastic bodied Smart ForTwo.
The companies will cooperate in design, engineering and production of the two-seat Smart as well as Renault's European small car the Twingo and future four-seat versions of cars for both Smart and Renault.
Although the groups have taken a cash neutral, 3.1 percent holding in each other's shares to cement the deal, Renault-Nissan Chairman Carlo Ghosn stressed that there is no interest in a merger.
Daimler CEO Dieter Zetsche said there will be three new Smart models starting in 2013, all designed right from the ground up, namely a two-seat coupe and convertible ForTwo versions and a new design four-seat version that would effectively revive the earlier short-lived ForFour model. That model was abandoned on short notice in March 2006 by former Daimler management. The original Smart ForFour shared some common parts with the Mitsubishi Colt.
Zetsche said that the two companies have had teams working on the Smart and Twingo area for several months. He added that there will be electric-drive versions for each of the new models. The iconic Smart design will be retained and will differ from that of the Twingo, he said.
Two-seat versions of the cars will be made at Daimler's assembly plant in Hambach, France. Renault's facility in Novo Mesto, Slovenia, will make four-seat cars. The two automakers also will co-develop common gasoline and diesel engines for both brands, as well as a new generation of Mercedes-Benz premium compact cars using three- and four-cylinder engines.
Hambach turned out 96,000 cars in 2009, although it has production capacity for 140,000 per year, according to Automobilewoche, a sister publication of Plastics News.
We had to take action for smaller models and engines, Zetsche said. The small-car market is highly competitive and price-sensitive; we need to optimize the cost structure.
Ghosn said that through measures such as cross-manufacturing, selective common purchasing, reduced development costs, better capacity utilization and intelligent use of economies of scale, Renault-Nissan will gain 2 billion euros ($2.67 billion) of net value in cost reduction and revenue over the next five years, split equally between Nissan and Renault. Zetsche added that Daimler will benefit to a similar extent from the alliance.
Discussion started between the two companies on renewal of the Smart, but then we discussed more areas of opportunity, Ghosn said.
Other cooperative ventures will look at light commercial vehicles and the luxury and premium market, he said. That will help Renault move its brands into areas where Daimler and the Nissan Infinity vehicles already are strong.
Nissan will benefit under the cooperation between the two groups with shared modules and components.
Cooperation is important for the future of Smart, said Ulrich Fromme, spokesman for the German and European Smart dealers and vice president of the German ZDK car trade association.
The planned alliance of Daimler and Renault provides a new perspective for the innovative small- car market, he said in an interview with Automobilwoche before the announcement. The trade must still overcome a thirsty period until the first new models reach the market in 2014. The [Smart] brand urgently needs a successor for the two-seat ForTwo.
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