Renault to End Better Place Partnership After Bankruptcy
Renault SA (RNO) (RNO), France’s second-biggest carmaker, is ending a five-year partnership with Better Place LLC after the operator of electric-vehicle charging stations announced plans to shut down.
Better Place filed a motion for liquidation with an Israeli court yesterday after failing to attract new investments, according to a company statement.
Renault and Better Place began working together in 2008 and said a year later that they aimed to sell 100,000 of the Fluence ZE, the French carmaker’s first electric vehicle, in Israel and Denmark by 2016. The partnership included the development of the QuickDrop service, by which owners of Renault’s Fluence could switch the battery in one of Better Place’s stations in each country in less than five minutes.
“We’re currently working to continue to ensure after-sales services for all the electric cars in Israel, where more than 80 percent of Better Place’s activity takes place,” Gilles Normand, head of Renault’s Asia-Pacific operations, said on a conference call today. “The investment in the partnership hasn’t been significant.”
Renault dropped as much as 75 cents, or 1.3 percent, to 58.50 euros and was 0.8 percent lower as of 12:36 p.m. in Paris trading. The stock has gained 45 percent this year, valuing the Boulogne-Billancourt, France-based company at 17.4 billion euros ($22.5 billion).
Renault has sold 1,000 Fluence electric cars in Israel and 240 in Denmark, Raluca Barb, a Renault spokeswoman, said by phone today. Owners of the vehicles can still charge the cars themselves at home and Renault will continue to provide warranties and maintenance services, she said.
“We were approached to participate in the fund-raising round,” Normand said. “But this is not our role.”
Renault and affiliate Nissan Motor Co. (7201) are investing a total of 4 billion euros in electric vehicle projects through 2015.
“I regret what’s happened,” Renault Chief Executive Officer Carlos Ghosn told reporters in Paris today. “But it doesn’t call into question our initiative in favor of electric vehicles, nor does it call into questions our support for batteries that can be swapped.”
The car’s low performance and relatively high price compared with conventional vehicles proved too big a hurdle as Better Place, founded by former SAP AG (SAP) executive Shai Agassi, failed to attract enough customers. The Palo Alto, California-based startup had raised $750 million since its founding five years ago.
Billionaire Idan Ofer’s Israel Corp., the largest investor with a 30 percent stake, said in a separate statement its board decided against investing more in the venture.
“This is a difficult day,” said Dan Cohen, the Better Place’s third CEO in just under a year. “Unfortunately, after a year’s commercial operation, it was clear to us that, despite many satisfied customers, the wider public take-up would not be sufficient and that the support from the car producers was not forthcoming.”
To contact the reporter on this story: Mathieu Rosemain in Paris at email@example.com