Renault to maintain mixed ethanol combustion engines in Brazil -September 22, 2023 at 05:26 pm EDT

SAO PAULO, Sept 22 (Reuters) – Renault will
maintain production of ethanol-fueled combustion vehicles in
Brazil, where nine in 10 cars are equipped to run on a mixture
of gasoline and the biofuel as fully electric vehicles (EVs)
need more government support, the head of the French carmaker’s
Brazil branch said on Friday.

“It still pays to invest in combustion in Brazil,” top
executive Ricardo Gondo said at an event, adding that the
industry will need more federal incentives to accelerate its EV
transition.

Renault is wrapping up a $2 billion reais (over $400
million) investment in the country which includes a new vehicle
platform to be produced in its Parana state industrial complex,
that would allow the company to produce combustion engines in
the facilities and “allow electrification”, Gondo said.

Renault did not say when it plans to manufacture electric
cars in Brazil, and the only one it sells in the country – its
China-made Kwid model, which according to the country’s EV trade
association, sold only two vehicles last month.

Renault is planning to launch Brazilian sales of an electric
version of its French-made Kangoo van in October, when it will
also launch its Kardian combustion engine SUV, set to be
manufactured locally.

While Gondo defended Renault’s plans for a “transition
period” for electrification in Brazil, rivals such as Chinese
automakers BYD, Great Wall Motor Co Ltd,
Chery and JAC are disrupting traditional local manufactures with
fully electric models sold in Brazil.

“The combustion engine will continue to see improvements in
energy efficiency,” Gondo said, adding that the government
should adopt quotas for electric cars tax-free imports to
protect local manufacturers that face highly equipped products
imported from China that have competitive prices.

Earlier this month, Renault CEO Luca de Meo warned a “very
competitive” industry in China and that it will need to “catch
up fast”. The company is planning to spin-off its EV unit
together with partners Qualcomm and Nissan.

Meanwhile, the government of Brazilian President Luiz Inacio
Lula da Silva has placed an emphasis on fighting climate change
and reversing policies enacted by his predecessor, Jair
Bolsonaro.

($1 = 4.9256 reais)
(Reporting by Alberto Alerigi Jr.; Writing by Carolina Pulice;
Editing by Sarah Morland and Marguerita Choy)