Renault SA highlighted how much work remains to increase productivity at three French plants that the struggling automaker hopes to transform into one of Europe’s largest centres for electric vehicles.
The company announced the formation of ElectriCity, a wholly owned subsidiary that would combine operations at three locations in Douai, Maubeuge, and Ruitz to produce up to 400,000 vehicles per year. Renault has promised that the independent legal organization would include research and development initiatives as well as a training facility.
Renault claimed in a statement that ElectriCity “will be Europe’s largest and most competitive electric car production facility.” Labor unions announced their support for the initiative on Tuesday, while some cautioned that future contract discussions might be difficult.
ElectriCity CEO Luciano Biondo outlined Renault’s objectives, saying that the factories are operating at considerably below capacity and that production costs are significantly higher than they should be.
The EV center is an important aspect of Renault CEO Luca de Meo’s plan to bring the company around and increase production of electric and hybrid vehicles. He is juggling pressure from the French government, which is Renault’s largest stakeholder, to maintain employment and EV technology in the nation, as well as from investors who want the firm to become more profitable.
“There remains work to be done,” Biondo said on a conference call with journalists about the hub, where the business has vowed to add 700 additional jobs by 2025 on top of the 5,000 people already employed at the factories. Renault is attempting to reduce a net total of 4,600 French jobs as part of a broader cost-cutting strategy.
New Electric Vehicle Platforms and Electric Vehicles by Renault
The plant assignments are the most intriguing element, since they disclose the utilization of new EV platforms and models.
Later this year, the Douai facility will begin manufacturing of its first electric vehicle. It will be the all-electric Megane E-Vision, which will be built on the CMF-EV platform developed by the Renault-Nissan-Mitsubishi Alliance and used by Nissan in the future Ariya vehicle.
The facility will also begin manufacture of a new C-segment car based on the same CMF-EV platform at a later date.
Renault will also build electric vehicles in Douai, based on a new B-segment electric platform. In other words, there will be at least three all-new models, with the possibility of more, based on two different electric vehicle platforms.
The Maubeuge facility is no stranger to electric vehicles, having produced the Renault Kangoo Z.E. with lithium-ion batteries for over a decade.
Renault will unveil the all-new Kangoo Van E-TECH Electric in 2022. We expect the factory to manufacture electric vans for Nissan and Daimler as well.
Other plants will receive electrical components from the Ruitz facility.
Biondo believes that manufacturing utilization rates in both Douai and Maubeuge are excessively low. The former produces around 25,000 automobiles per year, despite having a capacity of 300,000. Last year, the latter plant produced roughly 100,000 utility cars and has the capacity to create 250,000 this year.
Renault’s plant production expenses are also “quite far” from the appropriate range of between 3% and 4% of a vehicle’s price tag, according to Biondo. He demanded a three-hour reduction in the time it takes to build each Kangoo vehicle at Maubeuge.
He said the business has already spent roughly 1 billion euros ($1.2 billion) on factory renovations, and that more will be required to make the assembly lines ready for future EV models. Renault is anticipated to announce plans for battery production at the site later this month.