(March 31): Renault SA and Nissan Motor Co agreed to further loosen their long-term alliance, paving the way for more share sales as the Japanese automaker remains under pressure to shore up its finances.

The carmakers will be able to reduce their cross-ownership to no less than 10%, from 15% previously, Renault said on Monday. The French manufacturer will take over the companies’ Indian joint venture and produce a small electric car for Nissan from next year.

The agreement updates the alliance a day before Nissan gets a new chief executive officer. Ivan Espinosa will replace Makoto Uchida on Tuesday after a potential tie-up with rival Honda Motor Co collapsed.

Renault — still Nissan’s biggest shareholder with a 36% stake — has been partially unwinding the partnership amid mounting rivalries and mutual suspicion. The Japanese automaker, meanwhile, is under pressure to refresh its outdated line-up and navigate the upheaval caused by Donald Trump’s tariff push.

Renault “has a strong interest in seeing Nissan turn around its performance as quickly as possible”, CEO Luca de Meo said.

Nissan will be released from an earlier commitment to investing in Renault’s electric-vehicle business Ampere, according to Monday’s statement. Ampere will develop and produce a Nissan-designed vehicle based on Renault’s Twingo model from 2026.

Renault buying Nissan’s 51% holding of the joint Indian business is meant to help the French company expand abroad, de Meo said. The transaction is subject to customary regulatory approvals and expected to be completed by the end of the first half.

The impact of the moves on Renault’s free cash flow this year is expected to be around €200 million (US$216 million or RM959.57 million). The company still confirmed its full-year guidance for free cash flow and its operating margin.

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