Renault, Nissan, Mitsubishi target annual synergies of €10b in 6-year plan – focus on EVs, autonomous cars

Mitsubishi joining to make it three members in the Alliance calls for a new plan, and the just-unveiled Alliance 2022 six-year plan is a big one with eye-popping numbers. Objectives include the doubling of annual synergies to €10 billion by the end of the plan, with more than nine million vehicles to share four common platforms. The use of common powertrains will cover 75% of total sales.

“To achieve this target, on one side Renault, Nissan and Mitsubishi will accelerate collaboration on common platforms, powertrains and next-generation electric, autonomous and connected technologies. From the other side, synergies will be enhanced by our growing scale. Our total annual sales are forecast to exceed 14 million units, generating revenues expected at $240 billion by the end of the plan,” explained Carlos Ghosn, chairman and CEO of the Alliance.

In the first half of 2017, Renault, Nissan and Mitsubishi volumes increased by 7% year-on-year to 5.27 million units, while sales of EVs reached a combined total of more than 500,000 units.

Total unit sales are expected to exceed 14 million vehicles per year by the end of the plan. Combined financial revenues are forecast to reach $240 billion by 2022, up more than 30% on the $180 billion aggregate revenues achieved in 2016.

The increased synergy target of €10 billion by the end of the plan follows a 16% rise in synergies in 2016 to €5 billion. The doubling will be achieved partially by contributions from Mitsubishi, specifically through deeper localisation, joint plant utilisation, common vehicle platforms, and an expanded presence in mature and emerging markets.

Additional synergies are expected from light commercial vehicles, aftersales and technology-sharing in electric vehicles, autonomous drive, connected cars and new mobility services. This will complement synergies from already converged functions in engineering; manufacturing engineering and supply-chain; purchasing and human resources.

On the product side, the target is to produce more than nine million vehicles on four common platforms, up from two million vehicles on two platforms in 2016. By the end of the plan, the three companies will share 22 engines out of a total of 31, compared with 14 engines out of a combined total of 38 in 2016.

The existing and fruitful Alliance common platform – the Common Module Family (CMF) architecture – will be extended to a new common EV platform with autonomous drive capability and to a new B-segment common platform. Mitsubishi will gain access to the CMF architecture and utilise common powertrains by 2020.

The Alliance 2022 plan also lays down technology building blocks that will contribute synergies by avoiding development duplication and providing better access to innovation for member companies. The three blocks are EVs, autonomous-drive and robo-vehicles, and connectivity and mobility services.

Everyone’s harping on electric now, but the three Alliance members have long been in the game – think Nissan Leaf, Mitsubishi i-MiEV and Renault Zoe. Today, it’s the global leader in pure EV sales and the goal is to remain at the top of the pile when it comes to “mainstream, mass market and affordable EVs” across the world.

The electrification building block will involve common, scalable EV platforms for multiple segments by 2020, with a forecast that 70% of EV volumes will be based on shared platforms by 2022. A new family of EV motor and batteries will be introduced from 2020 and there will be 12 new pure EVs launched by 2022.

The EVs planned will have much better range than today’s cars. The target is more than 600 km of EV range in the New European Driving Cycle (the just-launched Nissan Leaf is rated at 378 km in the NEDC). The Alliance is also targeting 15 minutes charging time to deliver range of 230 km by 2022, up from 90 km in 2016 (NEDC) and a 30% decrease in battery cost from 2016 to 2022. The companies will also adopt Mitsubishi’s new plug-in hybrid technology as the common C/D segment PHEV solution by 2022.

Besides EVs, self-driving cars are in vogue today, and the Alliance members “are on track” to launch 40 vehicles with different levels of autonomous drive (AD) tech by 2022. Test programmes are underway, and the timetable for AD deployment starts with “highly autonomous drive vehicle for use on highways – with a human driver’s continuous monitoring of the environment” in 2018.

The target is to produce and AD car by 2020 that can be used in cities (with a human driver’s continuous monitoring) and highways (with occasional human driver intervention). The end game is in 2022, when the group aims to have its first fully autonomous drive vehicle with no human driver intervention necessary.

Field tests are continuing on robo-vehicles with partners DeNA (Japan) and Transdev (France), and the Alliance is aiming to be a key operator of robo-vehicle ride-hailing mobility services, and a major player and provider of vehicles for public transit use and car-sharing.

Lastly, the Alliance Connected Vehicles and Mobility Services team is developing new mobility services and partnerships. New connectivity solutions for end-customers will be available in vehicles starting next year. These will include a common in-vehicle infotainment and connectivity system, and the launch of a Connected Cloud platform to manage all data interfaces.

The cloud platform will provide a gateway to AD capability for robo-vehicle services, self-driving delivery vehicles and shuttles. The Alliance says that it will deliver operational efficiencies for member companies such as improved logistics-management and enhanced use of data-sharing in manufacturing and as a mechanism to reduce warranty costs.

The connectivity plan will include the development of an open ecosystem that will allow new services and features to be deployed throughout the vehicle lifecycle.

“This plan will boost the growth and profitability of our member companies. We intend to deliver on growing synergies, with three autonomous companies cooperating with the efficiency of one. The Alliance has grown and performed with two members since 1999. With Alliance 2022, we will prove that we will grow and perform with three companies or more,” a bullish Ghosn concluded.

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