VW and Renault Consider Tie-Up for Low-Cost BEV Production

Volkswagen is thought to be exploring a commercial tie-up with Renault in a bid to produce inexpensive battery-electric vehicles to compete against a wave of low-cost Chinese cars expected to flood into Europe.

The rumors have been cited in the German Handelsblatt newspaper whose sources claim the automakers want to cooperate on a shared vehicle platform to bring a sub-€20,000 ($21,476) BEV to market. While that paper’s sources are quoted as saying negotiations with Renault are “at a very early stage,” the move makes sense considering the French automaker’s production advantage since the establishment of its Ampere BEV business.

Renault carved out the stand-alone company from the rest of the group earlier this year to provide platforms for its own BEV offerings, but with the implication the company also could work as a Tier 1 supplier for other automakers.

The businesses’ platforms have been used in several Renault products including the Megane E-Tech, Scenic E-Tech, Renault 5, Renault 4 and the Twingo Legend concept to replace the current electric Twingo and expected to sell at the targeted €20,000 threshold before any government subsidies.

Renault’s Alliance partners, Nissan and Mitsubishi, also recently confirmed they are investing up to €600 million ($647 million) and €200 million ($215 million), respectively, in Ampere.

A spokesperson for Renault tells the Reuters news agency cooperation is necessary to be competitive with small, entry-level electric vehicles, adding: “We are in different discussions but nothing has been finalized.”