The Renault-Nissan car making alliance, the fourth-largest in the world by sales, said Friday it expects to generate more than 5.5 billion euros ($6.03 billion) in synergies by integrating divisions across four core units of engineering, manufacturing, purchasing and human resources.
The alliance had generated more than 4 billion euros ($4.39 billion) in annualized synergies in calendar year 2015. Since Renault rescued Nissan in 1999, the Japanese carmaker has outgrown its French parent and now leads Renault in sales and engineering.
"The auto industry is rapidly evolving, requiring Renault and Nissan to leverage the alliance as a pragmatic business tool," Renault-Nissan CEO and Chairman Carlos Ghosn said in a statement. "The road ahead is one of more convergence, working more closely together," he added.
The alliance said the convergence of the four core units would be finalized after an internal approval process, with implementation set to begin April 1. The companies also said that heads of the new units and the scope of their functions would be announced at the time.
The 16-year old alliance had come under pressure since April last year when the French Economy Minister, Emmanuel Macron, temporarily raised France's Renault stake to secure a permanent increase in its voting rights — a move not well received by Nissan or CEO Carlos Ghosn, who has headed both carmakers for the last decade.
The 8-month power struggle ended in December with a compromise deal under which Renault conceded increased state influence but weakened control over its Japanese affiliate. Nissan also received written assurances that Renault would never attempt to control the Nissan board or propose resolutions at its shareholder meeting without prior approval, according to Reuters.
Shares of Renault were up marginally Friday, trading 0.42 percent higher on the Paris Stock Exchange in afternoon trade.