Renault-Nissan alliance rebalancing is backed by France, report says

PARIS -- The French government supports a reshaping of the Renault-Nissan alliance and will not oppose a rebalancing of the equity stakes the two carmakers hold in each other, Les Echos reported on Tuesday.

Les Echos, citing unnamed sources, reported that French President Emmanuel Macron made the assurances to Japanese Prime Minister Fumio Kishida during talks between the two leaders in Paris on Monday.

The Elysee did not immediately respond to a request for comment. Renault declined to comment.

In their negotiations, which focus on how to retool a long-standing alliance between the two carmakers, Renault is hoping to convince Nissan to invest in its electric vehicle business, while Nissan is seeking the sale of part of Renault's stake in Nissan to put the two partners on a more equal footing.

The French state is Renault's largest shareholder with a stake of 15 percent. Renault in turn is Nissan's largest shareholder with a 43 percent stake, much more than Nissan holds in the French carmaker.

"There is no longer any major blockage," Les Echos quoted a source close to the matter as saying. "It is only a question of reassuring the various actors that the two governments are on board."

According to two sources cited by the newspaper, French Finance Minister Bruno Le Maire sent a detailed letter to his Japanese counterparts to confirm Paris' support for this reshaping of the alliance.

Renault CEO Luca de Meo plans to split the automaker into five autonomous businesses. The main plank of his strategy is the separation of its combustion engine business from its EV operation. Nissan is concerned about Renault's plans to sell a large stake in its gasoline-engine business to China's Geely.