French vehicle manufacturer Renault and Chinese Geely announced on Tuesday the establishment of a joint company that will produce gasoline engines and develop hybrid technology.
Renault and Geely will equally share ownership in the new company, which will employ 19,000 people across 17 factories and three research and development centers, the companies stated in a press release, without disclosing financial details. The agreement is expected to be finalized next year, when the company is set to begin operations.
Renault and Geely anticipate that their joint investment will supply internal combustion engines and hybrid powertrains to Nissan and Japanese Mitsubishi Motors, a smaller partner in Renault’s alliance that also includes Japanese Nissan.
The company will have the capacity to deliver around five million engines and hybrid systems annually, they said.
Renault’s CEO Luca de Meo stated that Renault is seeking a partner to reduce the costs of producing internal combustion engines, including hybrids.
It is unclear whether the new project marks the beginning of closer cooperation between Renault and Geely in the development of gasoline vehicles, Reuters notes, reminding that the EU will implement a ban on the sale of internal combustion engines by 2035.
