Renault Group eyes Korea as key export hub, hints at major investment

Industry

Published: 12 Oct. 2022, 14:55

Renault Group eyes Korea as key export hub, hints at major investment

Luca de Meo, CEO of Renault Group, talks about his strategies for the Korean market during a press conference held in southern Seoul Tuesday evening. [RENAULT KOREA MOTORS]

Renault Group hopes to make Korea a key export hub for the French carmaker, hinting at millions of euros of investment in Korea over the next six years.

“Renault Korea Motors' Busan plant will be the key export hub for our mid- to large-sized vehicles,” Luca de Meo, CEO of Renault Group said during a press conference held in Cheongdam-dong, southern Seoul, on Tuesday evening.

“For that, Renault Group is willing to invest hundreds of millions of euros in Korea for the next six years.”

Meo’s commitment marks Renault’s latest focus on the Korean market. Renault Korea Motors changed its name from Renault Samsung Motors in March.

In 1994, Samsung established Samsung Motors, which was acquired by France's Renault in 2000 following the 1997 Asian financial crisis. Renault agreed to include "Samsung" in the company name and paid 0.8 percent of annual sales to Samsung for use of the name. That contract ended in August 2020.

Renault Korea Motors is currently developing a new hybrid model with Geely Holding Group with the aim of commercialization in 2024. The vehicles will be solely manufactured in its Busan plant.

The new hybrid SUV will be developed based on Volvo Cars’ Compact Modular Architecture platform, the company said.

Geely is Renault Korea Motor’s second-largest shareholder with 34.02 percent, after Renault Group BV, a Dutch subsidiary of Renault Group. Geely also owns Sweden’s Volvo Cars.

“Korea is very good platform to export our products,” Meo added. “Korea has signed free trade agreements with so many countries, and it roles as a bridgehead of manufacturing vehicles and exporting them.”

Renault Korea Motors exported a total of 83,886 vehicles this year as of September, up 76 percent on year. Its Busan plant's annual capacity stands at 300,000 units.

It is Meo’s first time visiting Korea after his appointment in July 2020. Meo visited Renault Korea’s Busan plant and held meetings with heads of Korean battery makers to discuss further partnerships.

"One of the reasons behind my business trip to Korea was to meet with Korean battery makers," Meo said. "We hope to expand the battery capacity for the European market, and have been discussing this with Korea's three battery companies."

When asked about the possibility of building a joint venture with LG Energy Solution, Meo said the two companies are “having talks regularly,” though no details can be announced at the time.

LG Energy Solution supplies batteries to Renault’s two electric vehicles — the Megane E-Tech and Zoe.

Renault introduced XM3 hybrids in the Korean market on Oct. 1 and over 4,000 orders have already been made so far.

BY SARAH CHEA [chea.sarah@joongang.co.kr]