Ford to use Renault technology, factories for cheaper European EVs to fend off Chinese rivals

Renault will jointly develop small, cheaper electric vehicles for Ford for the European market and will also work together to produce commercial vehicles to reduce costs and fend off increasing competition from Chinese rivals, the companies said on Tuesday.“We know we are fighting for our lives in our industry,” Ford CEO Jim Farley told reporters in Paris on Monday ahead of the announcement, as he described Ford’s response to the threat of cheaper Chinese competition. “There is no better example than here in Europe.”

Europe’s traditional carmakers are facing an influx of Chinese rivals, from BYD to Changan and Xpeng.

As part of the Ford-Renault partnership, the first of two planned small electric cars – to be produced at a Renault plant in northern France – will reach European car showrooms in 2028. They will be smaller than any of Ford’s plans for the U.S. market and fill a gap in the automaker’s lineup, Farley said.The two carmakers will also jointly develop Renault and Ford branded vans for Europe.

A POWERPASSER FOR LIGHT COMMERCIAL VEHICLES

“Together we can create a powerhouse of light commercial vehicles in Europe that the Chinese will find very difficult to compete with,” Farley said. While there are few Chinese-branded vans on sale in Europe, Farley says the two companies are “in direct competition with them every day” in emerging markets.

“The Chinese will come soon and that is why I do not want to wait,” said Renault CEO Francois Provost.

The collaboration came about after a Renault team visited Ford’s headquarters in Detroit in March. Both Farley and Provost said the two automakers have no plans to merge.

Ford’s share of the European passenger car market has almost halved in Europe from 6.1% in 2019 to 3.3% in the first ten months of this year, as Ford has withdrawn from passenger car sales. As part of a series of restructurings, the company has cut jobs and closed its Saarlouis factory in Germany this year.

Given the withdrawal of EV support from US President Donald Trump’s administration, the No. 2 US automaker faces the dual costs of investing in combustion engine models and expensive new EV technology.

Using Renault’s EV platforms with Ford designs should help the American automaker compete in the European electric car market against traditional automakers such as Volkswagen and the Chinese.

Ford already produces two EV models in Europe on a Volkswagen platform and makes vans with the German automaker. Ford CEO Farley said the Renault partnership will complement the existing partnership with Volkswagen.

The French carmaker also develops vans with Nissan and Volvo Group.

THE SMALLEST MAINSTREAM CAR MANUFACTURER IN EUROPE

Renault is Europe’s smallest mainstream carmaker and does not sell cars in China or the United States – the world’s two largest car markets – so the Ford partnership is increasing the scale of production to reduce costs.

The French automaker is actively seeking partnerships to better utilize its factories and reduce the burden of developing new electric vehicles.

By 2026, Renault will produce two vehicles using platforms from China’s Geely in Brazil and is in talks with more automakers, including China’s Chery, to jointly produce and sell cars.

“Our ambition… is to show that we can produce EV cars in Europe that can be as competitive as anyone, including the Chinese,” said Renault’s Provost.