Renault, Nissan to Extend Joint Procurement

PARIS, June 28 Reuters is reporting that Renault SA and Nissan Motor Co said today that they had agreed to take their car-making alliance a step further by jointly buying a greater proportion of components.

In a statement, the French and Japanese manufacturers said joint purchasing would be increased to an annual value of $21 billion from approximately $15 billion currently, with the additional volume concerning mainly powertrains.

Common purchasing, which brings unit cost savings and gives the two carmakers more power over pricing, is a crucial element of their broader alliance, which also includes manufacturing and sales.

Renault shares were trading up 2.7 percent at 46.72 euros at 0749 GMT, while the wider Dow Jones Stoxx European autos index was up 1.3 percent.