French and Japanese automakers Renault and Nissan are said to be looking to increase their global partnership in an effort to become more competitive with Volkswagen.
Alliance managers met late last month to discus increasing their relationship - or, as an unnamed executive told Reuters, to "seek further synergies to get to double where we are today."
The move would also stabilize the companies after CEO Carlos Ghosn eventually steps down.
Ghosn has been in charge of the Renault-NIssan alliance since its inception in 1999 when the French automaker took a hefty share in then-fledgling Nissan. Now, the tables are almost turned as Nissan is soaring and Renault continues to stumble. In part, Renault's limited market reach is to blame since Europe continues to struggle economically.
Renault and Nissan paired up at a similar time to Daimler and Chrysler, but the former has succeeded because the two brands' relationship is limited, at least in terms of global brand alliances.
Ghosn's contract is up for renewal at Nissan in 2013 and at Renault in 2014, but there are few indications that shareholders are looking to remove him as chief executive.
A tightening up of the alliance would see costs reduced substantially across the board. Currently, the two automakers operate essentially autonomously, although they do share certain platforms and technologies. By and large, however, Renault and Nissan are separate brands.
An upgraded alliance would likely be shifted structurally to a common holding rather than a common merger, a move that would address Renault shareholder concerns.
What this means for the North American market is unclear. We're not likely to see Renault-branded products here for at least a decade, if ever again, while Nissan's new modular architecture has already been earmarked for most of its lineup. Instead, Renault-Nissan collaborations will probably invisible above the surface as they are likely to be centered around logistics, electronics and vehicle development.