Renault Group is considering producing the next generation of its compact electric vehicles at its Palencia plant, in Spain, CEO François Provost stated on Thursday alongside the release of the company’s 2025 full-year results.
Provost, who took over as CEO in July after predecessor Luca de Meo departed for luxury group Kering, is set to outline a new strategic plan on March 10.
Renault Group may shift its EV production strategy, as it expands its battery electric vehicle (BEV) lineup in European markets, with the new Twingo E-Tech as the latest addition.
Until now, the group has built all its electric vehicles at its French factories.
The Palencia project, known internally as C-EV, would involve up to three electric models built on the new AmpR Medium platform with 800-volt architecture.
The project has already secured over €53 million ($62.6 million) in grants from Spain’s PERTE VEC 2 program, with an additional €13 million in supplementary funding.
Production of the new models is expected to begin in 2027 or 2028.
They are expected to include the next-generation Scenic E-Tech as well as electric versions of the Austral and Rafale.
Spanish Factories and Models
In Spain, Renault Group operates three production factories — Palencia, Valladolid, and Sevilla —, with the majority of its administrative offices in the capital of Madrid.
The Palencia plant, located in Villamuriel de Cerrato, is the most recent one established in the country, in 1978.
In 2024, the factory manufactured a total of 138,702 vehicles, according to the French group.
The facility currently produces the Renault Megane 4 small family car, Austral E-Tech crossover SUV, Espace 6 E-Tech hybrid SUV, and Rafale E-Tech fastback.
All those models are available in Spain, as well as several BEV options, such as the Renault 5 E-Tech, Scenic E-Tech, and the Twingo E-Tech, which debuted at last month’s Brussels Motor Show.
The group currently builds its electric vehicles at its ElectriCity hub in northern France, which Provost said is ramping up production with the addition of a half night shift at Douai and up to six models on the line, including vehicles for Nissan, Mitsubishi, and Ford.
Earlier this month, the brand announced that the Shanghai e-Drive electric motor for the last fully electric model will be assembled in its Cléon plant from Spring 2027.
Meanwhile, the company is also planning to roll out the new Clio and Renault 4 E-Tech in Europe later this year.
Chery Production in Spain
Renault Group is not the only automaker considering producing its EVs in Spain.
Earlier this month, Reuters reported that Chery will start production of its own vehicles in the country “as soon as possible” this year, as stated by the Chinese company’s Executive VP and EU chief executive Zhu Shaodong.
The 2026 timeline represents the automaker’s second delay, following an earlier postponement to Q4 2025, citing commercial reasons including EU tariffs on Chinese-made EVs.
Chery originally planned to start Barcelona production in 2024.
The facility, a joint venture with Spanish carmaker Ebro located at a former Nissan plant, aims to produce up to 150,000 vehicles per year by 2029.
Group’s 2025 Earnings
On Thursday, Renault Group — which includes the core Renault brand and the Dacia and Alpine brands — posted revenue of €57.9 billion ($68.3 billion) last year.
The figures represented a 3.0% increase from the prior year’s €56.2 billion.
Exceeding the €57.7 billion ($68.0 billion) industry estimates, the figures represented a 3.0% increase from the 2024 result: €56.2 billion, equivalent to $66.3 billion.
However, the French company reported a net income loss of €10.9 billion ($12.8 billion) for 2025. In comparison, the group had recorded a €891 million — or $1.1 billion — net profit in 2024.
This year, Renault Group expects profitability to decline, as it sees an operating margin of about 5.5% of the revenue, which is below analyst projections and 2025’s 6.3%.
The automaker proposed a flat dividend of €2.20 — equivalent to $2.59 — per share, for approval at the Annual General Meeting scheduled for April 30.
Last year, the group sold a total of 2,336,807 vehicles across all powertrains and brands, increasing 3.2% from 2024.
New energy vehicles (NEV) represented a quarter of the group’s overall 2025 deliveries — approximately 194,000 BEVs and 400,000 hybrid electric vehicles (HEV), posting year-on-year growths of 76.7% and 35.1%, respectively.
