Renault: Globalization, But For What Purpose?

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Reference

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.

The text is downloadable. This presentation page is also printable. Please, go to the end of this page. The Statistical Appendix is in a separated file.

Abstract

In the late 1990s, Renault took the decision to become a global firm. It acquired Nissan, Dacia and Samsung one right after the other, and also set up its own operations in two new automobile countries (Brazil and Russia).

This was not Renault’s first attempt to escape the confines of Western Europe – being, in actual fact, the fourth time that the French carmaker had tried this since the Second World War. Earlier efforts had either failed, or else involved operations that were a long way away from achieving the expected outcomes. In certain instances they had even caused serious problems for the firm. Is it possible that the lessons which we can derive from these earlier episodes will help us to understand and evaluate recent internationalisation-related decision-making? Did Renault absolutely have to internationalise in order to remain durably profitable and independent? Which problems will the alliance between Renault and Nissan have to overcome if it is to be successful?

The text tries to answer these questions by analysing Renault’s stop-and-go internationalisation trajectory in the light of the fundamental pre-conditions for automobile firms’ profitability, such they were defined during the 1993-1996 GERPISA research programme entitled “The emergence of new industrial models” (Freyssenet, 1998a; Boyer, Freyssenet, 2000a, 2000b). There are two pre-conditions that need to be met: the “profit strategy” which the firm pursues must be relevant to the “growth modes” of the countries in which it is operating; and the means to implement this profit strategy (product policy, productive organisation and employment relationship) must be coherent and acceptable over the long run to all of the parties concerned, through the development of a “company governance compromise”.

Content

1. The prioritisation of the domestic market after a brief export phase: 1945-54
2. Export as an indispensable factor in Renault’s new “volume and diversity” profit strategy: 1956-1960
3. Success of Renault’s “volume and diversity” strategy in those countries where it could be viable: 1961-1973
4. Problems with the “volume and diversity” strategy in the new international context and the need to gain market share in the industrialised countries: 1974-1984
5. A second withdrawal to Europe and the adoption of a “quality” strategy”: 1985-1992
6. The well-timed move towards an “innovation and flexibility” strategy : 1993-1998
7. The “Asian” crisis and the globalisation drive: 1998 -?
Conclusion: what profit strategy for Renault-Nissan Alliance?

Key words

Automobile, car makers, growth mode, profit strategy, productive models, employment relationships, productive organisation, product policy, company governance compromise, alliances, internationalization, globalization, cost reduction, innovation, flexibility, just-in-time, speculative bubble, Asian crisis, Renault, Nissan, Volvo, AMC, European Common Market.

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., 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, pp 103-131. Édition numérique, freyssenet.com, 2007, 360 Ko, ISSN 7116-0941.

✔ Freyssenet M., Shimizu K., Volpato G. (eds), Globalization or Regionalization of American and Asian Car Industry?, London, New York, Palgrave-Macmillan, 2003, 243 p.

✔ Freyssenet M., Shimizu K., Volpato G. (eds), Globalization or Regionalization of European Car Industry?, London, New York, Palgrave-Macmillan, 2003, 275 p.

✔ Boyer R., Freyssenet M., The productive models. The conditions of profitability, Londres, New York, Palgrave, 2002, 126 p.

Possible purchase websites

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http://www.amazon.fr

Last presentation page updating

2007.04.03

Date of the putting on line of the downloadable text

2007.04.03, 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.

Fichier attachéTaille
Renault, globalization, but for what purpose.pdf418.11 Ko
Statistical Appendix, Renault 1945-2000.pdf82.45 Ko