Renault in partnership talks with Daimler, others

French carmaker Renault is in talks with German rival Daimler and others about partnerships to cut costs as the industry tries to become more efficient exiting the downturn.

Areas covered include engines, transmission platforms, and access to new technologies, chief operating officer Patrick Pelata told journalists on Thursday, adding: "We are discussing serious matters with Daimler."

"Carmakers are holding discussions with each other. We are in talks with at least someone on all subjects," he said, adding Renault was in talks with several possible partners in some areas and all carmakers were probably doing the same.

A Daimler spokesman said: "We speak to various manufacturers, including Renault, about possibilities to cooperate."

Renault shares were down 0.6 percent at 1410 GMT, while Daimler shares were down 1.2 percent, against a DJ Stoxx European Autos Index .SXAP down 0.5 percent.

A partnership, which could take in small car platforms or electric vehicles, would be "more positive for Daimler than for Renault, given their relative size," Credit Suisse analyst Stuart Pearson said.

Pelata said that during the global crisis, carmakers "try to share the costs of access to new technologies, like the electric vehicle, batteries, fuel cells -- anything that is very expensive ... and which is a fixed cost but which they don't want to abandon because they think these technologies could be necessary in the future."

Full-year revenue at Renault is likely to be 17-18 percent below 2007, Pelata said, while 2009 fixed costs should be 18 percent lower than in 2007 with investment this year down 24 percent compared with 2007.

Pelata said it was too early for the company to announce a new performance plan. Earlier this year, Renault withdrew key targets, including a 6 percent operating profit margin for 2009, that had been set out by chief executive Carlos Ghosn, also CEO of Japanese partner Nissan Motor Co (7201.T).

Pelata forecast the European car market as a whole falling around 10 percent in 2010. He saw the possibility of an upturn in the battered Russian market, which is "going very badly at the moment," in the second half.

Last month, Renault said it would help its ailing Russian partner, Lada-maker AvtoVAZ.