Renault Group Korea has announced a landmark divestment, selling more than a third of Renault Korea Motors to the Chinese conglomerate Geely. The deal involves 45.5 million shares, representing 34.02 percent of the Asian company, for 264,000 million won. The move provides liquidity to fund Renault’s Renaulution strategy and its electrification push, aligning with a broader plan to strengthen value creation across the group.
Under the leadership of Luca de Meo, the Renault consortium is exploring monetization channels to support the transformation of its brands and offset declines in revenue. This development unfolds shortly after Renault signaled efforts to reduce its stake in Nissan and reports from Russia indicating AutoVAZ, the maker of Lada, could undergo a strategic shift. De Meo stated that a rapid decision would soon be made about Renault’s operations in Russia, a market considered the group’s second most important after Europe.
Renault’s repositioning centers on added value. Rather than chasing volume, the company aims to match the profitability of leading global brands such as Volkswagen or Ford by focusing on the margin per unit sold. The strategy targets an operating margin of 3 percent across all brands by 2022 and a sustained path to 5 percent profitability by 2025, reflecting a renewed emphasis on efficiency and brand strength.
a strategic move
Renault has operated in South Korea for more than two decades, yet recent performance has fallen short of expectations. Registrations in the market declined in 2021, dropping by 36 percent to around 57,480 units. The South Korean market remains highly competitive, with Hyundai-Kia commanding a dominant share and Genesis representing Renault’s niche. The sale does not erase Renault Korea Motors’ ownership structure entirely; Renault Group will retain 45.99 percent, while Samsung holds 19.9 percent. The firm had previously indicated intentions to divest fully, but Geely’s entry may instead shift control dynamics if it opts to acquire additional shares.
Geely’s purchase positions the Chinese group to enter a crucial South Korean market and to deepen ties with battery suppliers such as LG Energy Solution, SK Innovation, and Samsung SDI. Geely already manufactures electric vehicles for Polestar and Smart, and the investment opens a path to scale future battery supply for the company. Earlier in the year, Geely and Renault announced a joint project to develop hybrid models for the South Korean market, with production slated at Renault’s Busan facility.
Geely, an auto giant
Through this acquisition Geely adds a significant asset to its growing automotive empire, reinforcing its status among the world’s largest groups. The Chinese consortium already holds notable stakes, including a position with Mercedes-Benz AG and the Smart brand, as well as ownership interests in Volvo Group, Polestar, and other mobility ventures. Geely also operates Geely Auto in China, electric brand Geometry, and regional brands such as Proton in Malaysia, along with commercial divisions under Farizon Auto and Ouling Auto.
Beyond its traditional car lineup, Geely invests in technology and engines for the automotive sector, strengthening its research and development footprint. In 2021 the Geely group delivered approximately 1.36 million vehicle units across all brands, marking a modest growth compared with the previous year and signaling ongoing expansion as markets recover. The latest strategic moves position Geely to leverage Korea’s advanced manufacturing ecosystem and the region’s rapidly evolving electric mobility landscape.
[Citation: Renault Group press materials and industry coverage on strategic stake changes and Geely’s regional expansion.]