Renault confirmed a report that its joint venture with Chinese carmaker Brilliance Auto Group had run out of cash. Hence, they are heading for a restructuring. In light of the JV’s inability to meet its current financial obligations, the company’s board of directors has resolved to initiate a restructuring process.
Reuters Renault was in discussions to end its joint venture to build vans with the state-backed Chinese company. The tie-up dates back to 2017. That was when Renault and Brilliance China Automotive Holdings Ltd established manufacturing operations in Shenyang. They set out to make a push into electric commercial vans in particular. The Chinese market has proved difficult for some foreign producers’ sales faltered right before the pandemic. And that walloped the industry.
Last year, Renault had ditched its main passenger car business in China. This is after following poor sales at its loss-making venture with Dongfeng Motor Group. But it is making a fresh attempt to crack the market with Geely Holding Group. They also announced a hybrid vehicle joint venture. Bloomberg earlier reported that the French carmaker had decided to initiate a restructuring process.