Dongfeng Renault announces its exit, can French cars really not play?

"Doesn't my Corvette go unattended?" , "Will used Renault cars still be sold in the future?" , "Is there any guarantee of after-sales maintenance for Renault cars?" ......

Rumor has it that "Renault is pulling out of China?" Yesterday, 300,000 Chinese Renault owners must have been shocked. However, the Renault Group said, who said it would pull out of the Chinese market? It's just that it's not going to do passenger fuel vehicles anymore, and it's going to concentrate on electric vehicles and light commercial vehicles.

Dealers shouted also sell imported cars

On the fuel passenger cars, Renault Group has reached a preliminary agreement with the Dongfeng Group, the Renault Group in the Dongfeng Renault shares transferred to the Dongfeng Automobile Group. Simply put, Dongfeng Renault, the joint venture, is gone, and the production and sale of the three domestic fuel SUVs, Corvette, Correga and Corribine, have been discontinued in China.

"The only new-energy domestic car, eNuo, has been will continue to sell, and has been selling well." "Everyone Car Watch" first contacted the Beijing Dongfeng Renault 4S store sales consultant said, "domestic Renault models subsequent warranty is not affected, and the store will subsequently sell imported Renault fuel cars."

"It's all a non-issue for us." Renault 4S store sales consultant of this closing statement, we can have multiple interpretations, on the one hand, is to cheer themselves; on the other hand, it can only show that the domestic Renault model sales are really too dismal, has long been dispensable.

Dumping a big burden

The capital markets think otherwise. Yesterday, as soon as DFG shares were announced on the Hong Kong Stock Exchange, the stock price faltered, ending the day down 1.39 percent.

In this regard, the industry generally believes that the adjustment of Renault's business in China is by no means a spur of the moment; more so, the industry is not optimistic that the Dongfeng Group, in addition to Renault, there are hot potatoes Citro?n and Peugeot. The French car's dismal is naked.

Renault's strategic adjustment in China has actually been in the air for a long time. As early as the end of last year, it was revealed that in order to promote the cost reduction program, Renault did not rule out the possibility of withdrawing from some markets. The reason is very simple, but also very direct, China's auto market sales decline, the impact of the new European emissions regulations and the pressure of Britain's withdrawal from the European Union, but also have to mention the "Ghosn incident" impact. Earlier this year, Ghosn also sued Renault for 250,000 euros in retirement benefits.

The time to announce is just a matter of choosing the day.

In February, Renault's financial results showed that in 2019, revenues of 55.54 billion euros, a decline of 3.3% year-on-year; net profit of only 19 million euros, a year-on-year plunge of 99%, the first annual loss in 10 years.

The end of the Dongfeng Renault joint venture is really a big burden for Dongfeng Automobile Group to get rid of.On March 31, Dongfeng Automobile Group released its 2019 financial report, which showed that in 2019, dragged down by the sharp decline in the sales of Shenlong Automobile and Dongfeng Renault, the group's total sales and operating income in 2019 fell slightly. The data showed that the cumulative sales of Shenlong Automobile in 2019 amounted to 113,600 units, a year-on-year drop of 55.17%, while the cumulative sales of Dongfeng Renault in 2019 amounted to only 18,600 units, a sharp year-on-year drop of 62.87%.

This year is the seventh year of cooperation between Renault and Dongfeng, but in the end, they could not escape the seven-year itch and parted ways peacefully. According to Renault's own words, it is going to start a brand new era for Renault in China.

EJT is only responsible for production

Many people should be unaware that Renault is the foreign automaker with the most joint ventures in China. Before breaking up with Dongfeng Motor Group, Renault had four joint ventures in China, namely Dongfeng Renault, Jiangling Group New Energy Vehicle Co Ltd, EJT New Energy Vehicle Co Ltd and Brilliance Renault Jinbei Automobile Co Ltd.

One of them, Dongfeng EJT New Energy Vehicle Co., Ltd. is a joint venture between Dongfeng, Renault and Nissan, with Renault and Nissan holding 25% and 25% of the shares respectively, while Dongfeng holds the remaining 50%.

What does EJT do? You've heard of the Renault eNo, Dongfeng Fengshen EX1 and Dongfeng Qichen e30, right? In fact, these three models come from the same source, all built by EJT, also born in the CMF-A platform. We can understand that the three models are their respective rebranded products.

Renault's Asia-Pacific chairman, Mr. Franklin Cutter, once said, "You can think of EGT as an OEM, with Dongfeng Renault as the OEM's customer, and EGT as the supplier of parts and technology. In other words, the three shareholders are responsible for providing R&D and design, and EJT is only responsible for production, not direct sales.

After breaking up with Dongfeng, Groupe Renault said it will continue to strengthen cooperation with Nissan and Dongfeng in the joint venture project of EJT New Energy Vehicle Co. to make the Renault eNo a globalized model. This also means that Renault still maintains its cooperation with Dongfeng, and the roots are broken. Since EJT is only responsible for production, it remains to be seen how the eNo will be sold domestically in the future, and the original Dongfeng Renault dealerships will certainly be integrated.

Who is the new carrier?

Jiangling New Energy Automobile Co. Ltd. is the latest company in which Renault took a stake in July 2019, investing 1 billion yuan, accounting for 50 percent of the shares, and JLG accounts for 37 percent of the shares, with Renault as the actual controller.

The company currently has a brand called Easy to Auto, but the products are not impressive, basically some A-class, or even A00-class pure electric small cars, the popularity is even lower than Renault.

According to Renault, JLG New Energy will introduce Renault's quality management system and technology, and launch four models by 2022. If nothing else, Renault will use JNG New Energy as a vehicle for its new strategy.

In addition, some industry insiders believe that Renault and Dongfeng Group break up the trigger, is very likely to be Renault shares in Jiangling New Energy this deal. Imagine, in recent years, Renault has been mixed up in the country is not very good, in the possession of the Dongfeng Renault and EJT under the premise, but also to invest in other new energy vehicle enterprises, not to focus on firepower and Dongfeng *** through the difficult times, obviously is "broken feelings" signs. We can think, is Renault "a foot in two boats" in the first, forcing Dongfeng to break up with it?

The introduction of Renault commercial vehicles?

The last joint venture is Brilliance Renault Jinbei Automobile Co., Ltd, which, as its name implies, makes vans, and like Jiangling New Energy, has no Renault-badged models for sale at the moment.

But Renault said that after the introduction of Renault's technology and management experience, Brilliance Renault Jinbei plans to modernize and upgrade the Jinbei model, expand the company's product line, and launch five models before 2023. Its vehicles will also be exported to overseas markets. Predictably, the joint venture will still focus on producing commercial vehicles, with industry speculation that Renault's light commercial vehicles Kangoo, Master and Tafique may be introduced.

Renault Tafique

Renault can't sell passenger fuel vehicles, so it just sells electric and commercial vehicles. Granted, China is currently the world's largest EV market, but Renault wants to make a presence in the future with just EVs and vans? Do you think it's possible?

This article comes from the authors of the Automobile House car family number, does not represent the views of the Automobile House position.