Geely is working with Renault in South Korea, and here’s why we think this is happening.
Renault Group and Geely Holding Group have just signed an agreement on bringing some models to the South Korean market together and to export it from South Korea together too. Now, there’s a little bit of fluff about this in the press release that you can read below, but essentially, the deal is this:
What Cars?
The cars will be Geely-engineered, running on the shared CMA platform with Volvo Cars and there will be both internal combustion engine (ICE) and hybrid electric vehicles (HEVs) in the mix. Whether it’s just one vehicle with multiple powertrain options or an extensive portfolio of products on the CMA platform has yet to be confirmed. Lets also just assume it’ll be crossovers and SUVs that are first to be offered.
Where will they be made?
At the Renault Samsung Motors (RSM) plant in Busan. This whole deal centres around South Korea, where Renault has been running a car production operation together with Samsung for many years. Many of the parts that go into the familiar Renaults you see in Malaysian showrooms today come from this plant. The RSM plant has enough capacity to produce 8 models simultaneously, but currently produces just the Koleos, Arkana, SM6 and the Twizy (which barely qualifies as a car).
What’s in it for Renault?
Well, getting their plant to full capacity would probably be great for Renault. This is currently their largest manufacturing facility in Asia, so having a couple of big hits in the production line would be a great step in the right direction.
What’s in it for Geely?
Geely probably has enough plants to supply all the cars it wants, but what it probably wants is access to more markets where its products can compete effectively. We’re not sure how these new cars will be branded, whether they’ll be sold as both Renaults and Geelys or just Renaults or just Geelys, but what’s clear is that this deal is for both South Korean domestic sales and export as well.
It’s likely that Geely’s endgame is to take advantage of the United States-Korea Free Trade Agreement to gain access to the American market. Geely has been trying since at least 2017 to get a foothold in the United States but has failed to do so thus far. Maybe by dressing up some Binyues as Renaults will they finally achieve their plan.
PRESS RELEASE
Renault Group and Geely Holding Group (Geely Group), China’s largest privately-owned automotive group, have signed an agreement to launch a new collaboration dedicated to bringing fuel-efficient Hybrid Electric Vehicles (HEV) and Internal Combustion Engine (ICE) models to the South Korean market as well as for export sales. The new vehicles will be produced at the Renault-Samsung facility in Busan, South Korea, with production forecast to begin in 2024.
This collaboration marks a further step in efforts by the two automobile groups in producing low-emission models, as well as increasing their penetration in the Asian HEV markets. The partnership also forms part of Renault’s “Renaulution” program to upgrade the RSM brand and product portfolio by using industry leading technology, engineering and services as well as working with strong local partners.
The new products will utilize Geely Group’s world-class compact modular architecture (CMA), developed by Geely’s R&D centre in Sweden, as well as taking advantage of Geely Group’s advanced hybrid powertrain technologies. Renault and RSM will contribute their expertise in design and customer experience, while providing cutting-edge technologies to meet and exceed local market expectations.
The new vehicles will provide South Korean customers with premium features, industry-leading technology and strengthen RSM’s reputation in the market as provider of high-quality automotive services. While vehicles will be initially designed for the South Korean market, RSM will allow for their export in the future.
