Renault drops plan to develop flagship sedan with Mercedes-Benz

Article by Christian Andrei, on March 16, 2013

Renault has withdrawn from a joint project with Mercedes-Benz to develop an upscale, rear-wheel drive sedan for the French automaker. A Renault spokesperson told Automotive News Europe that after determining that the business deal wasn’t favorable, it then decided to halt a feasibility study for a sedan based on the Mercedes E class platform.

Renault had been hoping to create a profit-boosting flagship model ever since it stopped making its poor-selling Vel Satis in 2009. This sedan would have had a price tag of around 50,000 euros ($65,000).

In a Wall Street Journal report, it was revealed that Renault scrapped the project since Daimler was offering parts from its existing E class, which would be close to the end of its life cycle when Renault would begin manufacturing its own version. Renault hasn’t yet made any comment to this report.

The spokesperson said that Renault's present partnerships with Daimler are still in place. According to Gaetan Toulemonde, a Deutsche Bank analyst, Renault will probably find another partner to help it develop an upscale sedan model. He said that there had been numerous failures among automakers that launched luxury models. To reduce the risks, Renault had to team up with another company to reinvent itself in the high-end segment.

This means that as talks with Daimler have broken down, Renault will probably seek someone else. At the Geneva Auto Show, Renault Chief Operating Officer Carlos Tavares told Automotive News Europe that the company will focus on the models that will succeed the Laguna large sedan, Espace minivan and a new large crossover.

After discontinuing the Vel Satis, Renault presented the Latitude in Europe, a variant of the Samsung SM5 produced in Korea. JATO Dynamics said that the Latitude’s European sales have fallen by 70% to 2,085 units last year compared to the prior year.

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