Renault, 1992-2007. Globalization and some doubts

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Freyssenet M., Renault 1992-2007, Mondialisation et quelques doutes, Proceedings of Fifteenth GERPISA International Col-loquium, "What have we learned about the dynamics of automobile firms and systems over the past 15 years ?", Paris, 20-22 june 2007. Éditions numériques, gerpisa.univ-evry.fr, 2007, Ko; freyssenet.com, 2007, 1 Mo, ISSN 7116-0941.

Freyssenet M., Presentation, Renault 1992-2007, Globalization and some doubts, Proceedings of Fifteenth GERPISA Inter-national Colloquium, "What have we learned about the dynamics of automobile firms and systems over the past 15 years ?", Paris, 20-22 june 2007. Édition numérique : freyssenet.com, 2007, 1,5 Mo, ISSN 7116-0941.

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The text is in French, the slides presentation in English.

The communication was a preparatory text for a chapter about the Renault's trajectory that was published later in a collective book intitled "The second automobile revolution". It gives a lot of informations and reflections that vere not introduced in the final version.

The final version can be read and download cliking on the following reference

Freyssenet M., Renault 1992-2007, mondialisation et incertitudes stratégiques, french version of «Renault 1992-2007 : globalisation and strategic uncertaintiy», in Freyssenet M. (ed.), The Second Automobile Revolution. Trajectories of the World Carmakers in the 21st century, Basingstoke and New York: Palgrave Macmillan, 2009, pp 267-285. Édition numérique : freyssenet.com, 2009, 396 Ko, ISSN 7116-0941.

Abstract

During the last three years, Renault and its Nissan ally have encountered again some difficulties, after an exceptional period of common successes. The difficulties of Ren-ault in 1992-97 were the result of a performance crisis. The origin of the current diffi-culties seems to be a lack of coherence between orientations taken simultaneously. So the last fifteen years can be divided in three periods.

During the first period, 1992-1997, Renault changed its profit strategy. It put a strat-egy based on conceptual innovative products in place of a strategy privileging the "so-cial quality" of the cars. At the same time, it was led, to face a fall of the demand, to reduce strongly its costs, in particular by closings of factories (Setubal, Creil, Vilvorde) and by price reductions required of the providers.

The second period, 1998-2004, was characterized by the conjunction of several fa-vourable conditions. The unexpected success of its innovating models, in a context of strong increase of the national and European car market, enabled Renault to acquire Nissan, Samsung and Dacia, in a bankruptcy situation following the "Asian crisis". In only two years Renault who was a medium size firm in 1998, became with Nissan in 2000 the fourth world automobile group, present on all the continents. This global de-ployment could come to a bad end, like fusions Daimler-Chrysler-Mitsubishi or the alli-ance General Motors-FIAT concluded during the same period. At the contrary the Ren-ault-Nisssan alliance was until now a success story. That for at least three reasons: Renault has been able to understand what was the cause in the past of the failure of its previous fusion with Volvo in 1993. So partly thanks to that learning, it suggested to Nissan a new type of alliance which allowed a sufficiently trustful collaboration to be effective. Long economic stagnation of Japan and the failures of the former financial plans of Nissan allowed also the new management coming from Renault to take drastic decisions, which could be politically and socially unthinkable and unacceptable in Japan a few years earlier. Lastly, Renault could create "transverse teams" to identify the con-crete problems and to find effective solutions thanks to its own experience to improve rapidly its performances. The net income of Nissan became positive more quickly than it was imagined, and it contributed substantially for the benefits of Renault as early as the third year of the Alliance. Even Dacia, considered by many people as a dangerous and useless purchase, became a floret of the Group thanks to the success of its low cost vehicle Logan.

The period 2005- 200? revealed problems which had been masked by the exception-ally favourable conditions of the previous period. The fall of the demand in the devel-oped countries, not compensated for Renault by the increasing but irregular sales in certain emergent countries, the commercial failure or the disappointing sales of many new models (Avantime, Vel Satis, Laguna II, Modus, some versions of Mégane II) in-volved losses of market share and the fall of the financial results. The realization of some of the objectives for 2009 is now uncertain. The main problems, appeared dur-ing the last three years, seem to be the result of some economic, technical, organisa-tional, human and social contradictory requirements: the constantly renewed offer of conceptually innovating vehicles and the level always higher of the performances as regards "Quality-Cost-Times". Recent decisions (despecialisation of the factories, flexi-bility of the production lines, standardization of the interfaces of the components) can help to make them more compatible. Will they be sufficient?

Content

1. De la « qualité » à « l’innovation conceptuelle », 1993-1997
1.1. La stratégie de « qualité » prise à contre-pied par l’éclatement de la première bulle spéculative et l’échec de la fusion avec Volvo
1.2. « La qualité ne suffit pas… »
1.3. « Aller chercher la croissance là où elle se trouve »… à condition d’en avoir les moyens financiers et juridiques
1.4. Mais en attendant la sortie des modèles innovants et leurs éventuels effets sur les ventes, la situation se dégrade. Le choc Vilvoorde

2. Le temps de l’audace, 1998-2003. Le succès des modèles innovants dans un marché en forte croissance donne les moyens à Renault de se « mondialiser » d’un coup en ti-rant parti de la « crise asiatique »
2.1. La divine surprise : forte reprise du marché européen et succès des modèles inno-vants lancés… mais sans en tirer les enseignements
2.2. La « crise asiatique » saisie comme opportunité pour atteindre rapidement la taille mondiale: Nissan, Dacia, Samsung
2.3. La priorité : le redressement de Nissan
2.4. L’Alliance Renault-Nissan : économies, complémentarités, transfert des « meilleu-res pratiques »
2.5. Parallèlement à l’Alliance, Renault développe sa propre stratégie internationale en devenant un groupe multi-marques. Démarrage au Brésil. Retour en Russie et en Rou-manie. Entrée en Corée du Sud
2.6. Le « trou d’air » de 2001
2.7. Quatre nouveaux modèles dans le haut de gamme: trois échecs pour une réussite confirmée. Pourquoi ?
2.8. Les bénéfices sauvés par Scénic II et … Nissan. Pourquoi l’absence d’un SUV ?
2.9. Flexibilisation du travail, réduction des coûts, spécialisation des usines, cessions : un patchwork d’actions multiples, pas toujours cohérentes, dont certaines impulsées par les « équipes transverses »

3. La résurgence de problèmes non tranchés : 2005-200 ? Nouveau « trou d’air » ou symptôme d’une stratégie produit incertaine ?
3.1. Un changement d’époque ?
3.2. Un nouveau « trou d’air » pour la marque Renault et sa gestion
3.3. La révélation Logan
3.4. Renault-Samsung, un développement plus lent que prévu
3.5. Quelles sont les difficultés de Nissan ?

Conclusion. L’Alliance est-elle en train de rendre compatible innovation conceptuelle et commonalisation, ou bien ne fait-elle qu’inventer une nouvelle façon de combiner vo-lume et diversité ?

Key words

Automobile, Automobile industry, Renault, Nissan, Dacia, Renault-Samsung, Opel, merger, take-over, alliance, enterprises separation, internal growth, external growth, globalization, regionalization, internationalization, national growth modes, profit strat-egy, innovation, flexibility, business history, theory of firms, productive models, em-ployment relationships, productive organisation, product policy, company governance compromise, work content, work organisation, work conditions, competency, know-how, employment, work contract, social conflicts, cost reduction, innovation, flexibility, japanese model, lean production, speculative bubble

Concerned disciplines

Economics, Management, Geography, History, Political Science, Sociology.

Writing context

Contribution
to personal questioning
to scientific reflexion of research laboratory or network
to national and international scientific debate
to diffusion of scientific results
to implementation of scientific results

References, commentaries, critics

Curent relevance

See also

✔ Freyssenet M., The Origins of Team Work at Renault, pp. 293-305, in ✔ Sandberg Å. (ed.),Enriching Production. Perspectives on Volvo’s Uddevalla plant as an alternative to lean production, Avebury, Aldershot (UK), 1995, 459 p. Digital edition, New Preface, Åke Sandberg, Stockholm, 2007. Digital publication, freyssenet.com, 2007, 5,7 Mo, ISSN 7116-0941. English presentation. Présentation également en français

✔ Freyssenet M., Fridenson P., Pointet JM (dir.), « Les données économiques et sociales de Renault. Les années 70 et 80 », GERPISA, Paris, 1995, 222 p. Édition numérique, freyssenet.com, 2006, 6,8 Mo.

✔ Freyssenet M., “The Current Social Form of Automation and a Conceivable Alternative: French Experience”, in Shimokawa K., Jurgens U., Fujimoto T., (eds), Transforming Automobile Assembly. Experience in Automation and Work Organization, Springer, Berlin, 1997, pp 305-317. En anglais par un éditeur allemand en première publication. Édition numérique, freyssenet.com, 2006, 120 Ko.

Decoster F., Freyssenet M., “Automation at Renault: Strategy and Form”, in Shimokawa K., Jurgens U., Fujimoto T., (eds), Transforming Automobile Assembly. Experience in Automation and Work Organization, Springer, Berlin, 1997, pp 157- 166. En anglais par un éditeur allemand en première publication.

✔ Freyssenet M., “Renault, from Diversified Mass Production to Innovative Flexible Production”, in ✔ Freyssenet M., Mair A., Shimizu K., Volpato G. (eds), One Best Way? The Trajectories and Industrial Models of World Automobile Producers, Oxford, New York, Oxford University Press, 1998, pp. 365-394. Digital publication, freyssenet.com, 2007, 555 Ko, ISSN 7116-0941. En anglais par un éditeur anglais en première publication.

✔ Freyssenet M., Transformations in Team Work at Renault, in Durand, J.P., Castillo, J.J., Stewart, P. (eds.), Team Work in the Automobile Industry: Radical Change or Passing Fashion?, Londres, Macmillan, 1999, pp 202-217. Digital publication, freyssenet.com, 2007, 180 Ko, ISSN 7116-0941. Édition anglaise de ✔ Freyssenet M., “Les transformations du travail en groupe chez Renault”, in Durand, J.P., Castillo, J.J. et Stewart, P. (dir.), L’avenir du travail à la chaîne. Une comparaison internationale dans l’industrie automobile, Paris, La Découverte, 1998, pp 185-197. Édition numérique, freyssenet.com, 2007, 200 Ko, ISSN 7116-0941.

Freyssenet M., La Lettre du GERPISA, Février 1999 (n°129), “Attention: Renault!”, (Watch Out, Here Comes Renault!).

Boyer, R., Freyssenet M., La Lettre du GERPISA, Avril 1999 (n°131), “Renault-Nissan: pour quoi faire?”, (Renault-Nissan: What’s the Point?). Publié à nouveau en anglais par une revue anglaise, Boyer, R., Freyssenet, M., "Renault-Nissan, What's the Point?, Global Automotive Network, Londres, juin 1999.

Boyer, R., Freyssenet, M., “Renault-Nissan, le plus dur reste à faire”, Le Monde, 23 octobre 1999, rubrique Horizon-Débats, p. 17. Dans une version non écourtée, Freyssenet M., La Lettre du GERPISA, Novembre 1999 (n°136), “Renault-Nissan: le plus dur reste à faire et ce n’est pas ce que l’on croit”, (Renault-Nissan: The Hardest Is Still to Come and It Is Not What You Think It Will Be).

✔ Freyssenet, M., “Renault, une stratégie d’ 'innovation et flexibilité' à confirmer”, in Freyssenet M., Mair A., Shimizu K., Volpato G. (dir.), Quel modèle productif? Trajectoires et modèles industriels des constructeurs automobiles mondiaux, La Découverte, Paris, 2000, pp 405-440. Éditions numériques, freyssenet.com, 2007, 680 Ko, ISSN 7116-0941. Version française modifiée et complétée de ✔ Freyssenet M., “Renault, from Diversified Mass Production to Innovative Flexible Production”, pp. 365-394, in Freyssenet M., Mair A., Shimizu K., Volpato G. (eds), One Best Way? The Trajectories and Industrial Models of World Automobile Producers, Oxford, New York, Oxford University Press, 1998, 476 p. En anglais par un éditeur anglais en première publication.

✔ Boyer R., Freyssenet M., Les modèles productifs, Paris, Repères, La Découverte, 2000, 128 p. Version en espagnol, Boyer R., Freyssenet M., Los modelos productivos, Lumen Humanitas, Buenos Aires, Mexico, 2001, 115 p. Version anglaise révisée, Boyer R., Freyssenet M., The productive models. The conditions of profitability, Londres, New York, Palgrave, 2002, 126 p. Version allemande révisée et augmentée, Boyer R., Freyssenet M., Produktionmodelle, Ein e Typologie am Beispiel der Automobilindustrie, Edition Sigma, Berlin, 2003, 160 p. Deuxième publication en espagnol, Boyer R., Freyssenet M., Los modelos productivos, Editorial Fundamentos, Madrid, 2003, 155 p. Version italienne révisée et augmentée., Boyer R., Freyssenet M., Oltre Toyota. I nuovi modelli produttivi, EGEA, Università Bocconi Editore, Milano, 2005, 170 p.

✔ Freyssenet M., “Renault: Globalization, But For What Purpose?”, in ✔ Freyssenet M., Shimizu K., Volpato G. (eds), Globalization or Regionalization of European Car Industry?, London, New York, Palgrave-Macmillan, 2003, pp 103-131. Édition numérique, freyssenet.com, 2007, 380 Ko, ISSN 7116-0941. En anglais par un éditeur anglais en première publication.

✔ Freyssenet M., Renault, une mondialisation pour quoi faire ?, version française originale de ✔ Freyssenet M., “Renault: Globalization, But For What Purpose?”, in ✔ Freyssenet M., Shimizu K., Volpato G. (eds), Globalization or Regionalization of European Car Industry?, London, New York, Palgrave-Macmillan, 2003, 275 p. Édition numérique, freyssenet.com, 2007, 360 Ko, ISSN 7116-0941.

Possible purchase websites

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Last presentation page updating

2007.07.30

Date of the putting on line of the downloadable text

2007.06.30. Freyssenet M., « Renault 1992-2007, Globalization and some doubts », Proceedings of Fifteenth GERPISA International Colloquium, "What have we learned about the dynamics of automobile firms and systems over the past 15 years ?", Paris, 20-22 june 2007. Éditions numériques, gerpisa.univ-evry.fr, 2007, Ko; freyssenet.com, 2007, 1 Mo, ISSN 7116-0941.

Freyssenet M., « Presentation, Renault 1992-2007, Globalization and some doubts », Proceedings of Fifteenth GERPISA International Colloquium, "What have we learned about the dynamics of automobile firms and systems over the past 15 years ?", Paris, 20-22 june 2007. Édition numérique : freyssenet.com, 2007, 1,5 Mo, ISSN 7116-0941.