Der 127-jährige "alte Lord" arbeitet mit einem Limited Partner (LP) aus Hangzhou zusammen.

In early November 2023, Luca de Meo, CEO of French automotive giant Renault Group, visited China.

He first visited his old friend, Dongfeng Group. They had established a joint venture, Dongfeng Renault. Subsequently, he visited his new friend, Geely Auto. In 2021, Renault joined hands with Geely and achieved remarkable success in the South Korean market. Finally, Luca visited China International Capital Corporation (CICC).

Soon, market rumors spread that the French "veteran" was going to cooperate with CICC to set up an industrial investment fund. However, since the news was not confirmed, it was quickly buried in the flood of news.

Not long ago, the two - year - old rumor was finally confirmed. Renault China issued an announcement stating that it would cooperate with CICC, Hangzhou Capital, and Hangzhou High - tech Investment to establish an industrial investment fund focusing on fields such as new energy vehicles.

Interestingly, Renault was founded in 1898, the year of the Hundred Days' Reform in China. Now, the situation has reversed. The 127 - year - old European automotive giant has joined the Chinese venture capital ecosystem, which not only reflects the innovation ability of China's new energy vehicles but also represents a new story of cooperation between state - owned limited partners (LP) and overseas capital.

The French "Veteran" Seeks Survival

CEO Luca de Meo left Renault on July 15 this year to take up the position of CEO at Kering, the parent company of Gucci. Before leaving, the matter of the industrial fund he finalized in the Chinese market finally came to fruition.

Renault China officially announced that Ampere under the French Renault Group, CICC Private Equity, Hangzhou Capital, and Hangzhou High - tech Financial Investment signed a partnership agreement for a new energy vehicle industrial fund in Hangzhou. This is Renault's first cooperation with Chinese private equity institutions and local industrial capital. Although the fund size has not been disclosed, the investment direction is clear, and it will be deployed in multiple fields such as batteries, intelligent driving, intelligent cockpits, software, and embodied intelligence.

The establishment of the fund can be regarded as part of Renault China's strategy: Renault regards China as the global innovation center and relies on China's technological capabilities in the new energy vehicle field to help Renault reverse the market situation. Yes, this European "veteran" founded in 1898 (Note: The original text had a wrong founding year of 1989) suffered its greatest setback in history. Luca spent five years achieving an astonishing turnaround.

The story began in the year 2000.

In this year, Renault released its worst - ever financial report: The total global sales were less than 2.95 million vehicles, a year - on - year decrease of 21.3%; the annual operating income was 43.47 billion euros, a year - on - year decline of 21.7%; and the annual net profit loss was 8.05 billion euros. Renault was once regarded as a symbol of French industrial strength and had created classic models such as Dauphine and Floride, which were popular worldwide in the 1950s - 1980s with French aesthetics. Although Renault also faced fierce competition from Japanese and South Korean cars in the 1990s, the performance disclosed in 2020 made the board of directors extremely anxious.

So, they entrusted the task of turning the situation around to Luca.

Luca comes from an old Italian wealthy family, and his father is a commercial banker. It is said that he lived in multiple countries when he was a child and can speak five languages fluently, including French. After graduating from Bocconi University in Milan, Luca started his career at Renault. He has worked at Renault, Toyota (Europe), Fiat, Volkswagen, and other automotive companies. Before taking over at Renault, he was the chairman of Volkswagen Group's Italian company.

After taking office in 2021, Luca quickly released an innovative strategic plan called "Renaulution". "Renaulution" is a combination of "Renault" and "Revolution" - this new word shows great ambition.

According to this plan, Luca proposed a three - step strategic approach: From 2021 to 2023, focus on the company's profit margin and cash appreciation ability to achieve corporate revival; from 2021 to 2025, update and enrich the product matrix, enhance brand profitability, and promote the company towards innovation; after 2025, transform the business model into the fields of technology, energy, and mobility, making Renault Group a leader in the new mobility value chain, which is the "transformation".

These three steps correspond to a prescription for Renault's "survival", "preservation", and "development". Among them, the actions in the Chinese market are an important part of the second and third steps.

Leveraging Chinese Innovation to "Counter - attack" Europe

Luca first appointed former Volkswagen executive Su Weiming as the CEO of Renault China. Subsequently, he made a drastic decision to stop selling fuel - powered vehicles in the Chinese market and repositioned the Chinese market as an innovation center to empower the global market.

For example, in the second half of 2021, Renault joined hands with Geely Auto to enter overseas markets. Geely subscribed for 34.02% of the increased shares of Renault Korea at a price of 1.376 billion yuan, and the two sides jointly expanded the South Korean market. In 2023, Geely and Renault jointly established HORSE Powertrain Company. In June this year, the two sides established a joint venture in Brazil to deploy in South America.

Another example is that in October 2023, Renault joined hands with Dongfeng Motor to invest in the luxury intelligent electric vehicle brand BeyonCa. This new car - making force was founded by Su Weiming, the CEO of Renault China. This automotive brand can also be regarded as a company jointly established by Renault and Dongfeng Motor.

In addition to cooperating with vehicle manufacturers, Renault also established a research and development center called "Advanced China Development Center" (ACDC) in 2024. The main task of this center is to help Renault develop electric vehicles for the European market.

With the help of the Shanghai R & D center, Renault has made rapid progress. The electric vehicle Twingo, which will be launched in Europe in 2026, was developed by Renault in only 21 months, far shorter than the previous new - car development cycle of 3 - 4 years. Moreover, Renault expects that the goal of the Shanghai R & D center is to reduce the cost of Renault's next - generation electric vehicles by 40% before 2028.

The above measures have created a different path to revitalization from other European and American automakers. If traditional European automakers only regard China as a sales market, Renault does the opposite. It uses China's innovation as an "arsenal" and moves the sales "battlefield" to Europe, South Korea, and South America. As a Renault executive said, Renault will not sell these cars in China but will use Chinese R & D and the Chinese ecosystem to improve its competitiveness in markets such as Europe.

Currently, Renault has become one of the fastest - transforming traditional European automakers. In 2024, its sales increased by 1.3% year - on - year to 2.26 million vehicles, and the net profit was 752 million euros. In the first quarter of this year, Renault's pure - electric vehicle sales increased by 87.9% compared with the same period last year. China's strategy undoubtedly plays an important role in this successful turnaround.

Renault Has Already Invested in Chinese Companies

According to Renault's third - step plan, it will transform its business model from automobile manufacturing to become a leader in the fields of technology, energy, and mobility. Establishing relevant industrial funds in China and investing in cutting - edge technologies is also an important strategy.

A little - known fact is that this is not Renault's first time to set up an industrial fund in the Asia - Pacific region. As early as 2018, the Renault - Nissan - Mitsubishi Alliance jointly established a venture capital fund, Alliance Ventures, with a plan to invest $1 billion over five years to support open innovation.

The first company invested by this institution was Ionic Materials, an American company specializing in solid - state batteries. When I heard this news, I thought of that European company making batteries in the Arctic Circle. Later, I checked the latest situation, and sure enough, this battery company headquartered in Massachusetts had declared bankruptcy last year, just like Northvolt.

Of course, not all of Alliance Ventures' investments have such an outcome. For example, the two Chinese companies it invested in are developing well. One is the autonomous driving company WeRide. Alliance Ventures made two investments in 2018 and 2021 respectively, and now WeRide has been listed on the US stock market. Moreover, Alliance Ventures not only benefited from the IPO but also promoted the cooperation between WeRide and Renault. The two sides announced that they will commercially deploy L4 - level autonomous driving on a large scale and are expected to launch a series of low - carbon, emission - reducing autonomous micro - buses before 2030.

The other invested company is PowerShare. This Shanghai - based company mainly focuses on virtual power plant platforms. Alliance Ventures participated in its Series A and Series A+ financing rounds in 2019 and 2022. Interestingly, in addition to Renault - affiliated institutions, investors also include European automotive industrial capital such as Volvo Cars Technology Fund and Porsche Ventures, indicating that this company is very popular in the European automotive circle. Currently, PowerShare's business has also extended to Europe, providing energy management services in multiple countries such as Portugal and Spain.

These two Chinese companies are obviously more reliable than the American solid - state battery company. Presumably, the above investments have allowed Renault to see the creativity of Chinese companies in fields such as automobiles, energy, and artificial intelligence early on. Therefore, it has become a planned move to jointly establish an industrial fund with Chinese capital.

Renault's choice to cooperate with Hangzhou also has its reasons. In the first half of 2025, the automobile production in Zhejiang Province was about 810,000 vehicles. This figure ranks seventh in the country, with a significant gap compared with major automobile - producing provinces such as Anhui, Guangdong, and Chongqing. However, it is obvious that Renault chose Hangzhou for its technological innovation ability rather than its production capacity advantage (after all, it does not plan to sell cars in the domestic market).

There is no need to list all the details of Hangzhou's scientific and technological innovation ecosystem. Star companies have emerged in both the AI and humanoid robot tracks, and these two fields are at the forefront in the country. It is worth mentioning that among the two state - owned partners, Hangzhou High - tech Financial Investment has directly invested in Leapmotor, and Hangzhou Capital has directly invested in Avita. Both institutions have made deployments in the new energy vehicle field.

In addition, Hangzhou's state - owned assets have promoted the cooperation between Leapmotor and the European automotive company Stellantis. The latter acquired 10% of Leapmotor's shares and helped Leapmotor enter the European market. This shows that Hangzhou also has prior experience in cooperating with European automakers. This cooperation with Renault once again reflects the openness of Hangzhou's state - owned assets. How can local state - owned LPs cooperate with overseas industrial capital? Hangzhou may provide a typical case.

This article is from the WeChat public account "LP Spectrum", author: Yang Boyu, published by 36Kr with authorization.