Renault Reportedly Drops Plans for a Mercedes E-Class-based Sedan

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As part of its partnership deal with Daimler AG, Renault had plans to build a large luxury sedan, using the platform of the Mercedes-Benz E-Class. However, it seems the French carmaker has given up on its ambition to launch a new executive saloon, according to a report from The Wall Street Journal (WSJ).

While one would assume Renault’s reluctance to enter the premium car segment is due to its unfortunate past experience (how could we forget the Vel Satis?), the automaker concluded the plan doesn’t make business sense for the company.

“We haven’t found a business model that works,” Renault’s Chief Operating Officer Carlos Tavares said in the interview with the WSJ. The French carmaker's executive added that the decision to cancel the project was due to issues affecting sourcing, logistics and assembly, declining to comment further.

Given that Renault's executive sedan would have sold for more than €50,000 (equal to US$65,000), it's not hard to understand the management's decision. Furthermore, 2012 sales of the Laguna and Latitude sedans fell 41 percent and 36 percent respectively, so it may not be the best time for the French automaker to launch a much more expensive model.

An unnamed Renault official explained that plans were shelved because Daimler was offering components from its existing E-Class, a model that would already be dated when Renault would start making its own luxury car. The source added it was difficult to line up life cycles and that it wasn’t a matter of "ill-will" on the part of Daimler.

Renault said it would instead focus on revamping the upper end of its own lineup, following in the footsteps of Citroen and its DS line. Renault’s upmarket variants will wear the “Initial Paris” label, according to Tavares.

By Dan Mihalascu