Renault-Nissan to Form Car Battery Venture With French State and build Twizy EV in Spain

A letter of intent was signed today in Flins between the Renault-Nissan Alliance, the French Atomic Energy Commission (CEA) and the French Strategic Investment Fund (FSI) to create a joint venture that would develop and manufacture batteries for electric vehicles (EV) under the patronage of Christian Estrosi, the French Minister for Industry.

Renault, Nissan and the CEA would contribute technical expertise and infrastructure support in addition to an equity investment. The FSI, consistent with its mission of making long-term investments in companies in order to boost French competitiveness, will contribute 125 million euros to the project. In order to complete the financing of the project, the European Investment Bank (EIB) is considering a loan of up to 50% of the 280 million euros debt financing.

The joint venture between Renault, Nissan, CEA and the FSI would focus on advanced research, manufacturing and the recycling of EV batteries. From mid-2012 the joint venture’s ambition would be to produce 100,000 EV batteries per annum at the Renault plant in Flins, near Paris – these would be available for sale to any manufacturer. The investment value of the first phase of the project is estimated at some 600 million euros.

The Renault-Nissan Alliance will use its battery plants in France, the UK and Portugal to supply EVs built around Europe and Turkey. Renault will primarily use the batteries produced at Flins for the all new EV, previewed by the Zoé Z.E. Concept, also to be built at Flins.

The joint venture will have a sustainable approach to its entire operations, including developing technologies to facilitate on-site battery recycling. To date, the French government has created several initiatives towards zero emission mobility including public and private sector company bids on joint purchases of a 100,000 EV fleet by 2015, consumer incentives of up to €5,000 for the purchase of an EV (during 2012) and the development of an infrastructure through a planned 000 million euros investment financed by the French government.

“Realising the potential of zero-emission mobility on a mass scale requires unique collaboration between public and private sectors”, said Carlos Ghosn, Chairman and CEO of Renault and Nissan. We welcome the vision and commitment made today by the French government, the CEA and the FSI to invest with the Renault Nissan Alliance in the future of clean transportation.”

Bernard Bigot, Chairman of CEA added, "Bringing its strong know-how in the field of CO2-free energy technologies for a sustainable development, the CEA will be a key contributor for the R&D programmes of the joint-venture. Our partners can count on the full support of the CEA research teams in its challenging ambition to lead the electric vehicle market"

Gilles Michel, General Manager of FSI said “The FSI’s role is to help stabilize and strengthen the supplier network, in particular through the investment fund FMEA. By participating in a joint venture that holds great potential for the future of the auto industry, the FSI reaffirms its conviction that the industry still has much to contribute to France’s competitiveness.”

The Renault Nissan Alliance, founded in 1999, sold 6,090,304 vehicles in 2008. The objective of the Alliance is to rank among the world’s top three vehicle manufacturers in terms of quality, technology and profitability. Marking its tenth anniversary this year, the Renault-Nissan Alliance is leading a collaborative approach with both business and governments and has signed more than 30 agreements worldwide with partners to launch its first EV, starting in 2010, and to mass market a full range of EVs in 2012.

The CEA is a French government-funded technological research organization active in three main fields: Energy, Information and Health Technologies, and Defence and Security. As a major player in research & development and innovation, the CEA has developed strong links with industry through its labs based in Grenoble. The CEA aims to develop new energy technologies and focus on three keys areas:

Electrical technologies for transportation
Solar energy and low energy consumption buildings
Nano-materials for energy.

The F.S.I is a ‘Société Anonyme’ 51% held by Caisse des Dépôts and 49% by the French State. The FSI is a fund that takes minority interests in French companies that have the potential to create value and competitiveness for the economy.

Renault announced today that its Valladolid, Spain plant will become the home of a new electric vehicle based on the Twizy Z.E. concept that was show at the Frankfurt Motor Show in September. The Twizy is a peculiar looking two-seat city vehicle and it will be probably change quite a bit before production. The open sides will likely become fully enclosed and the wheel covers probably won’t make it to the road, at least not in their current form. That makes two EV production announcements this week for Renault, following yesterday’s decision to build a car based on the Zoe concept in France. The Twizy goes into production in 2011 alongside Meìgane Hatchback, Meìgane Estate, Modus and Grand Modus.

Renault, which already produces Meìgane Hatchback, Meìgane Estate, Modus and Grand Modus exclusively in Spain, has chosen to manufacture the future electric vehicle (EV) based on Twizy Z.E. Concept at Valladolid, 150 km north west of Madrid. Compact, nimble and practical, the future zero- emission EV will fully meet all sustainable urban mobility needs.

Valladolid was selected for its expertise and performance in compact car production. It currently produces Modus and Grand Modus and a share of New Clio output. The Group also chose to produce its future EV in Spain as close as possible to the sales market, namely Western Europe, in order to simplify logistics. Production will start in 2011.

After France, with the announcement of the production of the future city car based on Zoeì Z.E. Concept, it is now the turn of Renault’s Spanish production base to prepare for the industrialization of a zero- emission model.

Renault also announced last month that Valladolid would be allocated production of a thermal engine in 2012 and a fuel-combustion vehicle in 2013.

Fully aware of the issues involved in sustainable mobility, Renault has decided to mass market a complete range of affordable zero-emission electric vehicles starting in 2011.