TOKYO: French automaker Renault SA has said that its alliance with Japan’s Nissan Motor Co. and Mitsubishi Motors Corp. will terminate the joint procurement program among the three.

The announcement followed an agreement reached in July between Renault and Nissan to review their capital ties.

In a statement released Wednesday, Nissan said that under the new cooperation framework, the alliance will shift from the existing efforts centering on its global strategies to project-by-project collaboration in which each alliance member will use its capabilities to provide more competitive products and services.

In July, Renault and Nissan signed a definitive deal to reduce Renault’s stake in Nissan from 43 percent to 15 percent, the same as Nissan’s stake in Renault. The two aim to complete the necessary procedures by year-end.

So far, the three automakers have worked to cut costs by procuring auto parts and other items through a joint purchasing organization. The joint procurement has been a key benefit of their alliance.

The alliance hopes to use the capital relations review as an opportunity to speed up decision-making in procurement by allowing its members to make purchases more flexibly in line with their own strategies.

JIJI Press