Renault and Stellantis are merging into a new Group that will have almost 20 brands under its roof. This Group should be created after the proposal of the French government, which is the majority owner of Renault but also owns shares in Stellantis.

Stellantis chairman John Elkann denied the merger plans, responding to media speculation about a tie-up with Renault, which he declined to comment on. On the other hand, the government has supported Renault CEO Luca de Mea’s strategy from the start to build a new electrical and software unit based in France called Ampere. However, the relationship between Renault and Ampere became volatile following the group’s 2022 exit from Russia, its second-largest market after France at the time.

The French and Italian media point out that both manufacturers have a common interest in the fight against competition, primarily against Chinese manufacturers. Although the French government is considering Renault’s merger with Stellantis, it continues to support the Renault Group’s strategy of remaining an independent carmaker with several industrial and technological partnerships.

In this situation, Renault would benefit the most, because Stellantis with its 14 brands is far more competitive with the big EV manufacturers, whose demand has been growing for years. Also, there is the option of establishing connections with Geely, Saudi Aramco, Google and Qualcomm.

Whether the management of Stellantis will accept the proposal of the French government remains to be seen.

Source: Reuters