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China,France : RENAULT signs a joint venture agreement with DONGFENG
Publish Date : 17-Dec-2013
Carlos Ghosn, the Chairman and CEO of Renault, and Xu Ping, Chairman of Dongfeng Motor, signed a contract for the creation of a new joint venture company for localized production in China: Dongfeng Renault Automotive Company (DRAC). The final approval was granted by the the National Development and Reform Commission of China (NDRC).
The investment for the 50/50 JV totals 7.76 billion CNY (€870 Million).
This joint venture will establish a new manufacturing plant to produce vehicles in 2016. The new plant will have a production capacity of 150,000 vehicles per year, with the potential to double that in the future.
The plant will cover a total area of 95 hectares and leading the creation of 2,000 new direct jobs.
DRAC's product plan will begin with a crossover vehicles under the Renault brand. The new joint venture will introduce a range of products under a local brand. Sales of locally produced vehicles will start in 2016.
The Renault brand has been present with imported cars such as Koleos and Fluence. The Chinese car market provides a significant growth opportunity for Renault.
DFG chairman Xu Ping: "The launching of the Dongfeng Renault project symbolizes the start of a comprehensive cooperation between DFG and the Renault-Nissan Alliance. The project is a creative endeavor and practice in business model under economical globalization trends. It is a vital milestoneIt is a vital milestone for DFG's self-dependent development in opening process. We expect Dongfeng Renault will bring fascinating products and customer satisfactions for China auto market. We expect the success of Dongfeng Renault."
Carlos Ghosn, Chairman and CEO of Renault: "Dongfeng and Renault, as parent companies of DRAC, have been closely working together to ensure the future sucess of DRAC. Our partnership agreement is part of a long term strategy. The challenge is big and we are ready for it."
