Nissan and Renault have received about 1,770 joint patents over the past five years. (AFP pic)
TOKYO: Negotiations to reshape the alliance between Nissan Motor and its French partner Renault are now likely to continue into next year after the two sides missed yet another target date over disagreements regarding intellectual property.
Hoping to finalise and unveil a new deal early this month, Nissan and Renault had even discreetly secured a venue in London for a formal announcement on Wednesday.
But “there are many details that haven’t been clarified”, a Nissan executive said this month.
No further major meetings are believed to be scheduled for the rest of the year, especially with Christmas and the New Year approaching.
It is unclear when the two sides now expect to reach an agreement, though both sides maintain they share the same general goals.
The automakers had previously hoped a deal would be announced in November, when Renault CEO Luca de Meo and other executives visited Japan in hopes of making a breakthrough in negotiations.
Intellectual property has been one of the biggest sticking points.
Nissan and Renault generally share ownership of intellectual property that was developed with equal funding from both sides, regardless of which company led the process.
They have received about 1,770 joint patents over the past five years, according to Renault’s security filings.
Renault wants to share such intellectual property with partners outside of the automotive sector.
Under Renault’s new growth strategy announced in November, US chip company Qualcomm will invest in Renault’s new electric vehicle unit.
Renault will also work with Google on software-defined vehicles.
Nissan worries that granting access to cutting-edge technologies, like those related to EVs and advanced driver-assistance systems, could lead to leaks.
Sharing such intellectual properties with outside partners also means lending them engineers and other relevant personnel.
Nissan executives worry that this would add to the company’s costs.
“Renault hasn’t explained the details of the EV unit, so there’s no way for us to make a decision,” one said.
Meanwhile, Nissan’s top priority is lowering Renault’s ownership of the company to 15% – to match Nissan’s stake in Renault – from the current 43%.
It wants to revisit the automakers’ capital relationship, and will consider taking an up to 15% stake in Renault’s new EV unit.
These issues are part of “one package”, a Nissan source said, suggesting no deal is likely until both sides see eye to eye on them all.
Renault plans to list its EV unit in the second half of 2023 and is eager for a swift deal.
But more at Nissan, particularly outside directors, are now urging for more detailed discussions.
Another issue is the timeline for reducing Renault’s stake in Nissan.
The automakers are considering putting Renault’s extra stake in Nissan into a trust, to be sold gradually when market conditions are right.
It is difficult to predict when Nissan’s share price will be at a level acceptable to both parties.
The automakers are believed to expect the entire process to take at least 15 years.
Under the current Restated Alliance Master Agreement, which outlines the decades-long alliance, Nissan is allowed to appoint one more person to its board than Renault.
The French carmaker also cannot make shareholder proposals without Nissan’s consent, meaning Renault’s current stake has little impact on Nissan’s day-to-day operations.
“What we have now might be the best arrangement” for Nissan, a source familiar with the matter said.
It is also unclear if investing in Renault’s EV unit will pay off for Nissan.
The Japanese automaker will need to explain its reasoning for the move to its own shareholders.
