Renault granted $544M loan to aid fuel-efficient vehicle development

The European Investment Bank (EIB) has granted Renault a 400 million euro ($544 million) loan to aid research and development of its next generation of affordable, environmentally friendly vehicles.

Announced at the Renault Group’s Boulogne-Billancourt head office in France, the loan will fund a major technological and environmental project through which resources will be invested in three key areas.

The first component aims to advance Renault’s goal to drastically reduce the weight of its future vehicles and optimise their aerodynamics through the use of virtual platforms and prototypes.

The second focuses on the development of a “new-generation powertrain concept” for future commercial application, with the program to also investigate new industrial solutions for manufacturing the powertrain.

Finally, the investment will help fund the development and production of the next-generation Renault Twingo, which will be underpinned by a new “compact, modular and accessible” architecture.

Renault says it is targeting “very competitive CO₂ emissions levels” from the new Twingo city car, which will draw design inspiration from the Twin’Run and Twin’Z concepts when it launches in 2014.

EIB vice president Philippe de Fontaine Vive said the loan demonstrated the bank’s commitment to innovation.

“Cutting-edge technologies are a spearhead for the future in terms of sustainable development and competitiveness,” de Fontaine Vive said.

“Through our support for innovation, we are preparing the future of the European motor industry. And the first to benefit will be the EU’s citizens, in their daily life.”

The agreement builds on the existing partnership between the EIB and Renault Group and takes the total amount of finance provided by the EIB since 2009 to almost one billion euros ($1.36 billion).

Last month, Renault signed on as the sole supplier of electric powerplants to the all-electric FIA Formula E championship series set to debuts in 2014.