Renault-Nissan-Mitsubishi plans to invest $1 billion in auto tech startups
The autonomous driving car market is getting saturated. But that does not stop the world’s largest automotive alliance from its plan to invest and accelerate growth and innovation in mobility technologies. The French-Japanese group of automakers plans to start a corporate venture capital fund intended to invest up to $1 billion over five years in technology startups developing appealing new mobility technologies. “The plan is to create a group that can enable the large corporate alliance to work nimbly and quickly with far smaller startups,” the alliance said in a press release.
Carlos Ghosn, chairman and chief executive officer of Renault-Nissan-Mitsubishi, said: “Our open innovation approach will allow us to invest and collaborate with start-up companies and technology entrepreneurs, who will benefit from the global scale of the Alliance. This new fund reflects the collaborative spirit and entrepreneurial mindset at the heart of the Alliance.”
What is so unique about the fund is that it offers potential partners and tech startups access to the global scale and scope of Renault-Nissan-Mitsubishi. The three companies have sold more than 10 million vehicles in 2017 through 10 separate brands with a presence in all major automotive markets. The Alliance Ventures will invest in start-ups to bring new technologies and businesses to the Alliance while ensuring a fair financial return. The fund will make strategic investments at all start-up stages and will incubate both new automotive entrepreneurs and forge new partnerships.
According to their press release, “The first deal by Alliance Ventures will be a strategic investment in Ionic Materials, a promising US-based company which is developing solid-state cobalt-free battery materials. The equity acquisition coincides with the execution of a joint-development agreement with the Alliance for the purpose of R&D cooperation. Ionic, based in Massachusetts, is the developer of a pioneering solid polymer electrolyte that enables improved performance and cost-effectiveness of high-energy density batteries for automotive and multiple other applications.”
The joint fund entity comprises of Renault (40%), Nissan (40%) and Mitsubishi Motors (20%). The funding entity will have a dedicated investment committee to make investment decisions and monitor their performance. “This investment initiative is designed to attract the world’s most promising automotive-technology start-ups to the Alliance,” said Carlos Ghosn. As part of the Alliance 2022 strategic plan, Renault-Nissan-Mitsubishi is forecasting that the combined revenues of its member companies will reach $240 billion and that annual unit sales will exceed 14 million by the end of 2022.