Renault to set-up dedicated EV business ahead of electric-only push

French manufacturer Renault has become the latest marque to announce its intentions to divide its internal combustion engine (ICE) and electric vehicle (EV) operations.

Following the lead of Ford, Renault has confirmed it will create a separate entity which will be dedicated to developing, producing and selling EVs with more than 10,00 employees by 2023, while ICE and hybrid development continues through its main business outside France, again with a target of 10,000 staff.

The announcement comes as Renault reaffirms its plans to reach 100 per cent EV sales in Europe by 2030, five years before the European Union targets a ban of non-zero emission engines.

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While the EU is effectively banning ICEs through policy by 2035, international markets such as Australia will continue to be a source of demand for the traditional engines, something which the Renault Group acknowledges.

"Renault Group is also studying the possibility of combining its ICE and hybrid engine and transmission activities and technologies based outside France within a specific entity," said the manufacturer.

"In view of the innovative capabilities and significant improvements in emissions reduction of this type of vehicle, Renault Group is convinced that thermal hybrid and plug-in hybrid vehicles have significant long-term prospects and outlets in Europe and on international markets, and that its technologies, such as E-TECH [hybrid], represent real growth levers.

"By bringing together its activities and technologies related to thermal and hybrid engines and transmissions, Renault Group aims to strengthen the potential of its technologies, but also to contribute to the development of low-emission fuels, LPG, etc., and thus create a world leader in powertrain for the automotive industry."

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It seems Nissan is waiting to see how the French arm of the Renault-Nissan-Mitsubishi Alliance's decision plays out within in the evolving market, with Nissan's Chief Operating Officer Ashwani Gupta telling Automotive News Europe the Japanese manufacturer has looked at dividing its ICE and EV operations, but is not yet ready to do so.

"It's too early to consider because of our diversified market portfolio and diversified product portfolio," said Gupta.

According to the Automotive News Europe report, Renault is also looking to reduce its 43.4 per cent ownership stake in Nissan, as the latter marque only holds a 15 per cent non-voting share of its French partner.

Earlier this year, the Renault-Nissan-Mitsubishi Alliance announced it would invest €23 billion (AU$36.4 billion) into developing EVs over the next five years, targeting the introduction of 35 new models by 2030.