In a significant move that could reshape the automaking alliance between Nissan and Renault, Nissan Motor is reportedly planning to invest approximately 100 billion yen ($725 million) in Renault’s new electric vehicle (EV) unit, according to the Yomiuri Shimbun. This investment could potentially help overcome hurdles in the ongoing talks to revamp their partnership.

After lengthy negotiations, Nissan settled on the terms for a contract to overhaul its alliance with Renault and reached an agreement with its French partner on the investment amount in the EV unit called Ampere, as reported by the Yomiuri. However, a Nissan spokesperson clarified that discussions about the contract, including the specific investment amount, have not been finalized yet.

The Yomiuri cited sources familiar with the matter, revealing that Nissan and Renault anticipate Ampere’s enterprise value to range from 8 to 10 billion euros. Nissan’s investment ratio is expected to be less than 10% of that amount, falling short of the 15% maximum set by Nissan in February for the investment.

As part of the agreement, a Nissan director will join the new company, adding a Nissan presence to the EV unit. However, the Yomiuri mentioned that certain restrictions will be imposed on the use of intellectual property from Nissan.

This development comes after months of intense discussions between Nissan and Renault. In January, the two automakers agreed to a restructuring of their long-standing alliance, which will result in Renault reducing its stake in Nissan from approximately 43% to 15%. This adjustment aims to establish a more balanced relationship between the companies.

The investment in Renault’s EV unit represents a strategic move by Nissan to strengthen its position in the rapidly growing electric vehicle market. As the automotive industry shifts towards sustainable mobility solutions, EVs have gained substantial traction globally. By investing in Ampere, Nissan aims to tap into Renault’s expertise and resources in electric vehicle technology, expanding its capabilities in this critical segment.

While the finalization of the contract and investment details is yet to be concluded, this potential investment by Nissan signals a renewed commitment to collaboration and innovation within the alliance. Both companies will likely continue working closely together to navigate the evolving automotive landscape and drive the development of electric vehicles that meet the demands of a greener future.