Renault-Nissan Alliance: Success by Integration

            
 
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Case Details:

Case Code : BSTR422
Case Length : 14 Pages
Period : 2000-2012
Pub Date : 2013
Teaching Note :Not Available
Organization : Renault; Nissan
Industry : Automotive
Countries : Europe; Japan; Global

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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Excerpts Contd...

Benefits of the Alliance

The capital structure of Renault and Nissan, with Renault holding 43.4% (as of 2012) in Nissan and Nissan holding 15% of Renault , was seen as one of the reasons for the success of the alliance. "This structure has been very solid to help us cement the alliance, create a strong sense of belonging to the alliance, even though people are still fiercely Renault or fiercely Nissan," said Ghosn.

The Alliance was managed by Renault-Nissan BV, founded on March 28, 2002, in The Netherlands...

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Growing Through Collaboration

The Renault-Nissan Alliance was widely regarded as a success. The unique arrangement allowed the partners to take advantage of synergies, while maintaining separate identities and branding. "From the beginning, the Alliance has been based on the premise of trust and the pursuit of strategies aimed at profitable growth," said Ghosn.

Traditionally, Nissan had been strong in the US and Japan while Renault's performance had been better in Russia, France, and Brazil. However, as sales growth in developed countries was expected to be low in the coming years, both Renault and Nissan announced their intention to strengthen their market shares in emerging markets such as China, India, and Brazil. The two auto companies were to carry out joint development, R&D, and production in emerging markets, just as they did in developed markets ...

Challenges Ahead

Though Renault and Nissan had improved efficiency and reduced costs over the years, the two companies had as of 2012 yet to match the efficiencies of Toyota Motor Corporation or the Volkswagen Group , which were both centrally managed and closely integrated.

Despite the cost advantages, technology sharing, and synergies with Nissan, Renault's market share in Europe had shrunk in 2011. On the other hand, the VW Group was consolidating its position as the number one player in Europe ...

Exhibits

Exhibit I(A): Nissan Versa/Sunny and Renault Scala
Exhibit I(B): Nissan Micra and Renault Pulse
Exhibit II: Financial Information on Nissan
Exhibit III: Financial Information on Renault Group
Exhibit IV: The Alliance Logo
Exhibit V: Nissan's Financials in 1999 and 2003
Exhibit VI: Component Sharing between Renault and Nissan
Exhibit VII: Market Shares of Auto Makers in Europe
Exhibit VIII(A): Top 10 Alliance Markets in 2011
Exhibit VIII(B): Top 10 Renault Group Markets in 2011
Exhibit VIII(C): Top 10 Nissan Markets in 2011


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