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Renault and Nissan to Converge Four Major Alliance Functions

renault nissan

AMSTERDAM--March 17, 2014: To achieve a minimum €4.3 billion annual synergy goal, the Alliance is implementing convergence plans in four key areas: Engineering, Manufacturing & Supply Chain Management, Purchasing, and Human Resources. Converged business functions become official 1 April and are expected to have an immediate positive effect on operational performance. Newly appointed Alliance Executive Vice Presidents will take charge of increasing integration in each function.

The Renault-Nissan Alliance today announced it will begin implementing convergence initiatives in four key operational areas starting 1 April, with the goal of achieving at least €4.3 billion in annualized synergies by 2016.

Management teams and the boards of Renault and Nissan finalized the convergence plans following consultations with employee representatives. The Alliance initially launched convergence study projects in late January in four key areas: Engineering, Manufacturing & Supply Chain Management, Purchasing, and Human Resources.

Under the plan, these functions will be jointly managed by Renault and Nissan, with a newly appointed Alliance Executive Vice President leading each function, and a new management committee to oversee implementation.

"Convergence within these four key business functions will result in an immediate increase in efficiency and leverage our size to achieve competitive economies of scale," said Renault-Nissan Chairman and CEO Carlos Ghosn. "The synergies will then enable us to deliver higher-value vehicles to customers and stay at the leading edge of innovation."

Four Converged Alliance Functions with New Leaders

Engineering: Renault and Nissan will combine Common Module Family engineering, advanced research, powertrain development (including electric vehicles), systems engineering and testing facilities and services. Tsuyoshi Yamaguchi, Alliance Director of Platforms and Parts, is appointed Alliance Executive Vice President, Alliance Technology Development, for the new converged Alliance function.

Manufacturing Engineering & Supply Chain Management: The new Alliance converged manufacturing function will cover global industrial strategy (including sourcing), production process engineering, production control and supply chain management. Shohei Kimura, Nissan Corporate Vice President for Vehicle Production Engineering, is appointed Alliance Executive Vice President, Manufacturing Engineering and Supply Chain Management.

Purchasing: Renault and Nissan have enjoyed an integrated purchasing organization for more than a decade. But convergence of major engineering and manufacturing activities will drive greater purchasing synergies and more economies of scale. Christian Vandenhende, Managing Director of the Renault-Nissan Purchasing Organization, is appointed Alliance Executive Vice President, Alliance Purchasing.