Renault, Geely ink pact with Aramco for engine venture

French car maker Renault SA signed a deal with Aramco and China's Geely Automobile Holdings Ltd in which the Saudi oil producer would become a potential minority stakeholder in a new powertrain technology company, the companies said in a joint statement on Thursday.

Geely and Renault are expected to retain equal equity stakes in the new independent entity, the statement said, adding that the new company will be dedicated to internal combustion and hybrid powertrain technologies.

Reuters reported in January that the car makers were working to finalise a deal to join with Aramco to develop and supply gasoline engines and hybrid technologies, citing three people with knowledge of the talks.

The new company would have an annual production capacity of more than 5 million internal combustion, hybrid and plug-in hybrid engines and transmissions per year, the companies said.