Renault to build Geely-designed cars in South Korea

It’s official: Renault will manufacture Geely vehicles — most likely from the Lynk & Co brand — in South Korea.

The deal announced late last week means Renault Samsung will begin manufacturing cars based on Geely’s Compact Modular Architecture (CMA).

These new cars will use hybrid drivetrains and internal combustion engines (ICE) designed by Geely. It’s expected the first Geely-designed cars will roll off the lines at the Busan factory from around 2024.

CMA was developed by Geely subsidiary Volvo, and the architecture underpins the XC40, Polestar 2, and various vehicles from the Geely, Lynk & Co and Zeeker brands.

While these Renault Samsung-built cars will “initially [be] designed for the South Korean market, RSM will allow for their export in the future”.

Last year the two automakers said they were looking to build localised versions of Lynk & Co models in South Korea. A report last month in Reuters indicated these vehicles could then be exported tariff-free to the US thanks a free-trade agreement between the two countries.

While it might seem odd for Renault to lean on a partner that’s not part of the Renault-Nissan-Mitsubishi Alliance, the brand has committed to going all electric in Europe from 2030.

This likely means the company’s development budget for future ICE vehicles will be concentrated on the cut-price Dacia and Lada brands, rather than the more expensive offerings from Renault and Renault Samsung.

Samsung established its car making arm in 1994 with initial models being slightly revised Nissan designs. The nascent automaker soon ran into trouble thanks to the 1997 Asian Financial Crisis.

Renault purchased a 70 per cent stake in firm in 2000, and in time the Nissan-based models gave way to localised versions of Renault vehicles.

Some Renault models, such as the Arkana and Koleos, are primarily produced by Renault Samsung and exported around the world.

These exports have no doubt helped the Korean automaker, but sales of Renault Samsung vehicles in the domestic market have not been good. According to Automotive News the brand sold just 57,480 cars last year, a drop of 36 per cent from 2020.

This isn’t the first collaboration between Renault and Geely, with the two automakers announcing a joint venture in China in 2021.

Their relationship in the Middle Kingdom will see Geely engineer and produce Renault-branded vehicles, with the French company only responsible for “branding strategy, channel and service development, [and] defining [the] appropriate customer journey”.

Geely not only has its own array of brands — Geely, Volvo, Polestar, Zeekr, Geometry, London Electric Vehicle Company, Proton and Lotus — it’s also the largest single shareholder in Daimler.

Daimler and Geely now share ownership of Smart, with the Chinese automaker responsible for designing and building the brand’s next generation of electric vehicles. The first of which should go on sale globally from 2023, and will be similar to the Concept 1.