Renault and Geely Expect Completion of Engine Project Agreement by End of February

Two informed sources told Reuters that French car manufacturer Renault and its Chinese counterpart Geely expect to finalize an agreement on their joint project for combustion and hybrid engines by the end of February.

At the same time, one of the sources stated that Saudi Aramco intends to announce the signing of a memorandum of understanding to invest in the joint project, a step that confirms Aramco’s intentions stated in March of last year.

The source also added that Renault’s subsidiary, HORUS, and Geely would ultimately secure a 40% share of the joint project, while the remaining 20% would go to Aramco.

However, discussions are still ongoing regarding the exact percentage of the Saudi company’s investment. Renault and Geely announced in July of last year that the joint project would be equally divided between the two companies, with Geely taking a 33% stake in their European subsidiaries, Renault SAS and Groupe HV P&T, respectively.

A Renault spokesperson said, “Projects are proceeding according to plan, and we will continue at the appropriate time,” while a spokesperson for Geely Europe declined to provide any details about the timing of the deal.

The joint project aims to achieve annual sales of 15 billion euros and employ 19,000 people in 22 locations worldwide, primarily in Spain, Romania, Turkey, South America, and China.

It will be one of the two main pillars of Renault’s strategy to stay ahead of bigger competitors through multiple partnerships to reduce costs and access new markets.

Recently, Renault’s creation of the AMPERE unit focused on electric cars and the sudden cancellation of the unit’s initial public offering plan have taken precedence in this plan, which the company attributed to unfavorable market conditions.