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The Renault-Nissan alliance could become the world's third largest car-maker after GM and Toyota, according to CEO Carlos Ghosn.
Speaking in Paris at the unveiling of Renault's 2007 financial results, Ghosn revealed that the company was on the verge of signing a deal with Russian car-maker Lada.
Ghosn said talks were "well advanced" and he was "confident" of a deal to acquire 25 percent of AvtoVAZ, Lada's parent company.
AvtoVAZ's factory at Togliatti has a potential capacity of one million units per year, which, Ghosn claimed, would take the Renault-Nissan alliance up to sales of 7 million vehicles per year.
Renault-Nissan's outline plan is to support and expand the Lada brand, with Renault supplying the know-how to improve the current models as well as supplying platforms and drivetrains for future cars.
Ghosn also revealed that Renault's turnaround plan was meeting its targets, with global Renault sales up 2.1 percent to 2.494 million vehicles, and revenue up 27.4 percent. The company's all-important profit margin went up from 2.6 percent to 3.3 percent.
Renault is still pinning great hopes on its expanding family of low-cost Dacia cars. Production of the Logan is being expanded into Morocco and India, and the company expects sales of the model to balloon from last year's 365,000 units to 1 million by the end of the decade.
Ghosn also pointed out that, despite being a budget car, the Logan enjoys profit margins of 6 percent - more than double that of Renault's mainstream vehicles.
Hilton Holloway
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