allcarschannel Renault – Nissan Alliance has announced a Convergence initiative in four key operational areas. The convergence, which is initiated to begin 1 April, strives to achieve a goal of at least €4.3 billion in annualized synergies by 2016. Convergence in four key business functions is the latest step in the 15-year evolution of the Alliance, which was formed on 27 March 1999.

The Alliance has expanded significantly since its founding and now ranks among the world’s four largest automotive groups by sales volume. The Alliance has partnerships and joint ventures with Daimler, Mitsubishi, AvtoVAZ, Ashok Leyland and Dongfeng.

Renault – Nissan Alliance Chairman to lead Convergence operational areas

Management teams and the boards of Renault and Nissan finalized the convergence plans following consultations with employee representatives. The Alliance initially launched convergence study projects in late January in four key areas: Engineering, Manufacturing & Supply Chain Management, Purchasing, and Human Resources. Each  operational area is to be led by a newly appointed Alliance Executive Vice President and management committee that oversee the entire implementation.

“Convergence within these four key business functions will result in an immediate increase in efficiency and leverage our size to achieve competitive economies of scale,” Renault-Nissan Chairman and CEO Carlos Ghosn reiterated. “The synergies will then enable us to deliver higher-value vehicles to customers and stay at the leading edge of innovation.”

Renault – Nissan Alliance: Four Converged Alliance Functions with New Leaders

For Engineering, Renault and Nissan will combine Common Module Family engineering, advanced research, powertrain development (including electric vehicles), systems engineering and testing facilities and services. Tsuyoshi Yamaguchi, Alliance Director of Platforms and Parts, is appointed Alliance Executive Vice President, Alliance Technology Development, for the new converged Alliance function.

Next on Manufacturing Engineering & Supply Chain Management, the new Alliance converged manufacturing function will cover global industrial strategy (including sourcing), production process engineering, production control and supply chain management. Shohei Kimura, Nissan Corporate Vice President for Vehicle Production Engineering, is appointed Alliance Executive Vice President, Manufacturing Engineering and Supply Chain Management.

Thirdly, Renault and Nissan have enjoyed an integrated purchasing organization for more than a decade. But convergence of major engineering and manufacturing activities will drive greater purchasing synergies and more economies of scale. Christian Vandenhende, Managing Director of the Renault-Nissan Purchasing Organization, is appointed Alliance Executive Vice President, Alliance Purchasing.

In the human resources area, Renault and Nissan teams will implement common HR processes throughout the Alliance, including the creation of a unified “talent management” policy across the companies’ global operations. Marie-Francoise Damesin, Renault executive vice president for Human Resources, is appointed Alliance Executive Vice President, Alliance Human Resources. In addition, Greg Kelly, Nissan Senior Vice President of the CEO Office and Global Human Resources, is appointed Alliance Executive Vice President, Alliance Talent Management.

To assist with the deployment and ongoing development of the new organizational structure, a new Management Committee Alliance will be established, headed by Ghosn. In addition, Christian Mardrus, Senior Vice President and Managing Director for the Alliance CEO Office and Global Logistics, will become Alliance Executive Vice President for Renault-Nissan BV and the Alliance CEO Office.

Edited: Renault