The agreement marks a major step forward for the Japanese and French automakers, which have been reviewing their capital tie-up. The treatment of jointly held IP is one of the focal points of the talks.
The new company, announced by Renault in November and tentatively named Horse, will produce hybrid vehicle drivetrains and engines, with Chinese automaker Geely taking a 50% stake in the new company. Nissan will not have an ownership interest in the venture.
Unlike Nissan and Renault, which focus on different markets – the former in the US, China and Japan, while the latter concentrates on Europe – the new company plans to supply products to about 130 countries, including the US and China.
According to sources, Renault had told Nissan that it wanted to use patents and other IP jointly acquired with Nissan in the new venture.
However, Nissan said it would not allow the use of joint IP for products to be offered in the US and China to forestall competition with the new company and prevent technology leaks. In Europe, the Middle East and other regions, Nissan will also seek consent if products using joint IP are supplied to automakers other than Nissan.
A Nissan official told Nikkei that Renault has agreed to the restrictions on joint IP. Renault declined to respond, saying, “We do not comment on intellectual property.”
Nissan and Renault have jointly developed patents for internal combustion engine cars and hybrid vehicles since the start of their alliance in 1999. According to Renault’s annual reports, the two companies have developed about 1,770 joint patents in the five years through 2021.
In principle, a joint patent can be used freely by both companies without paying royalties, but in this instance, the two companies will not allow the use of the patents, even for a fee.
Nissan and Renault have been negotiating over their joint IP as “one package” in a review of their capital relationship. Nissan has requested that Renault give up a 28% stake in the Japanese carmaker, cutting its current 43% stake to 15%, which is equal to Nissan’s holding of Renault shares.