Renault-Nissan Alliance Posts Record €3.8 Billion in Synergies in 2014

PARIS and YOKOHAMA, Japan, July 10, 2015 /PRNewswire/ --

• Purchasing, engineering and manufacturing are biggest contributors to synergies 
• Common Module Family (CMF) drives synergies in all major areas 
• Convergence of key functions in 2014 accelerates synergy momentum  
• Sales and marketing and other functions increase contributions 

The Renault-Nissan Alliance posted record synergies of €3.80 billion in 2014, up from €2.87 billion the previous year. Purchasing, engineering and manufacturing were the biggest contributors. The launch of the Alliance's first Common Module Family (CMF) vehicles, as well as the recent convergence of four key units, helped drive synergies in all three areas.

     (Logo: http://photos.prnewswire.com/prnh/20140130/666713-a )

Synergies are generated from cost reductions, cost avoidance and revenue increases. Only new synergies (not cumulative) are taken into account each year. Accounting for synergies helps Renault and Nissan determine if they are meeting their performance objectives. More significantly, the net savings and revenue enhancements enable both automakers to offer higher-value vehicles to customers around the world.

"Our Common Module Family system continues to drive synergies in all major areas, from purchasing to vehicle engineering and powertrains," said Carlos Ghosn, Chairman and CEO of the Renault-Nissan Alliance. "At the same time, the recent convergence of four key functions at Renault and Nissan -- Engineering, Manufacturing Engineering & Supply Chain Management, Purchasing and Human Resources -- is accelerating the momentum."

Renault and Nissan converged the four functions on April 1, 2014. While Renault and Nissan remain separate companies, each function is led by a common Alliance executive vice president. Thanks to the convergence, the Alliance expects to overachieve on its goal of generating €4.3 billion in annualized synergies by 2016. That's up from €1.5 billion in 2009.

Common Module Family (CMF) 

Common Module Family is the Alliance's unique system of modular vehicle architectures and an increasing source of synergies (to see our CMF infographic go to blog.alliance-renault-nissan.com/node/2634/)

CMF enables Renault and Nissan to build a wider range of vehicles from a smaller pool of parts, while at the same time increasing customer choice and quality. Small vehicles are based on CMF-A, while mid-sized vehicles utilize CMF-B, and the largest vehicles use CMF-C/D.

By 2020, the Alliance expects 70 percent of its vehicles to be built on CMF architectures.

For the full release, go to: http://www.media.blog.alliance-renault-nissan.com/news/5489

Contact:
Mia Nielsen
Renault-Nissan Alliance
+33(0)6-10-83-31-33
[email protected]

SOURCE Renault-Nissan Alliance