Report: Renault Targets Mergers with Nissan, Then FCA

Renault hopes to resume merger talks with alliance partner Nissan within 12 months—then do the same with a company such as Fiat Chrysler Automobiles, sources tell the Financial Times.

Renault considered the idea of a merger with Nissan a few years ago and broached the subject with Nissan again last year. But the idea was shelved when Carlos Ghosn, then CEO of both companies, was arrested in November on suspicions of financial wrongdoing.

Since then, Renault and Nissan have emphasized that healing their successful alliance after Ghosn’s departure is a top priority. But after creating a new and more consensus-based management group earlier this month to oversee their alliance, Renault is again pushing to grow through merger, FT says.

Many second-tier carmakers are looking for ways to partner or merge. They are driven by the need to gain the volume needed to bankroll the spending on technology required to compete with the industry’s leaders: Volkswagen, Toyota and the Renault-Nissan-Mitsubishi alliance.

Whether FCA would be available for a deal with Renault isn’t clear. The company has been shopping on and off for a merger partner since 2015.

But FCA reportedly rejected an overture from PSA Group early this year, in part because it doesn’t want to focus too heavily on the European market. The same concern could apply to a would-be marriage between the company and Renault.