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Renault battery partner bust

May 27, 2013

Renault has played down the bankruptcy of the Israeli firm Better Place which had produced batteries for the French carmaker's electric cars. Renault says it will stick to its strategy to develop e-cars.

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Image: Reuters

The bankruptcy of Israeli battery maker Better Place would not in any way undermine Renault-Nissan's strategy to develop electric cars, the head of the French carmaker's Asia-Pacific region Gilles Normand said Monday.

Normand said Renault had sold about 1,000 of its Fluence model for which Better Place had developed its so-called Quick Drop technology that enables electric car drivers to swap batteries at service stations rather than waiting for them to recharge.

Renault was a partner of the Israeli firm but not a shareholder. Renault's investment in Better Place had amounted to a very small part of the 4 billion euros ($5.2 billion) set aside for electric car development until 2015, Normand said.

Electric cars still in need of fine tuning

"When you want to be a leader in a segment, you have to take risks," he added.

Venture founded in 2007

Better Place was founded in 2007 by Israeli entrepreneur Shai Agassi, a former top executive of German software maker SAP. Agassi persuaded Renault to equip a customized electric version of its Fluence sedan with Quick Drop technology.

In addition, he raised $850 million from investors like General Electric, HSBC and the European Investment bank to build a total of 50 service stations in Israel and Denmark - the two countries where most of the cars were sold.

However, on Sunday Better Place announced it would seek bankruptcy protection after demand for the car had proved insufficient and support from the car producer was no longer forthcoming.

Review, no exit

Renault said it would now review whether or not to abandon Quick Drop technology.

"We are coordinating with them [the firm's liquidator] to ensure that after-sales service continues, particularly in Israel," Normand said.

Contrary to the plans of its founder, Better Place never sold the 5,000 cars per year Shai Agassi expected to sell in Israel alone. Experts said the company misjudged consumers' willingness to embrace the car and their anxiety over its range. In addition, the price for the car was allegedly too high at $32,000.

uhe/ipj (AFP, AP, dpa)

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