Developing a new car with traditional technology costs an arm and a leg. Add future technology, and you are starting to talk real money. You need to spread the R&D costs across a lot of cars. The trouble is, massive sales of EVs are still just a dream. What to do in such a dicey situation? You look for partners. Renault and Daimler hammered out a new agreement. “Renault will supply the electric motors for the Smart and Twingo, we develop and make the batteries for both models,” Daimler’s head of research and development Thomas Weber told his hometown paper Stuttgarter Zeitung in an interview that will appear today in the print edition.
When Renault, Nissan and Daimler signed a three-way deal last April, batteries were not included. Each side thought they had the better one. Nissan has a Leaf, and what does Daimler have? Now they must have something. Daimler doesn’t want to rely entirely on Renault for the electric motors. They are talking with other suppliers, amongst them Bosch and Conti. “It is perceivable to sell the motors to other manufacturers,” said Weber, “in order to create more volume.”
Confused? You are not alone. Reuters got so lost in the fog of war when they wrote about the “battle for a foothold in the lucrative market for zero-emission vehicles” that they headlined their story with “Renault, BMW agree on Smart, Twingo supply deal.”