Boosting output, Renault-Geely ramps up engine production as electric vehicle adoption faces delays and market uncertainty.
Horse Powertrain, the Renault-Geely joint venture formed in 2022, is experiencing a resurgence as the global shift to electric vehicles (EVs) faces delays. The venture, which consolidates Renault’s and Geely’s combustion-engine operations, aims to become the world’s largest engine manufacturer by 2035, betting that legacy automakers will continue to rely on suppliers for internal combustion engines as the energy transition stutters.
Global developments have reinforced the opportunity. In the US, EV-friendly policies are being rolled back, while European carmakers lobby against the EU’s 2035 ban on new fossil-fuel vehicles. EV adoption in emerging markets remains slow, keeping demand for combustion engines steady. Horse Powertrain positions itself as a one-stop shop, producing everything from hybrid engines to small combustion units that extend range in plug-in EVs. The joint venture targets annual revenue of €15 billion ($17 billion) by 2029, up 80% from 2024.
CEO Matias Giannini emphasized the company’s role as a key supplier, noting, “Automakers cannot do it all. We’ve got to help them.” Currently, Horse ranks as the world’s No. 3 engine maker, operating 17 factories previously run by Renault, Geely, and Volvo Cars, including eight in China. Analysts say the move reflects slower EV adoption among high-end European brands like Porsche, Ferrari, Stellantis, and Ford, even as EVs gain market share in China and Europe.
Skeptics caution that the EV transition may accelerate rapidly in the future, posing long-term risks to combustion-focused ventures. Still, analysts argue that legacy expertise combined with Chinese scale gives Horse a competitive advantage by reducing automakers’ production costs. Pierre Loret of S&P Global summed it up: “The internal combustion engine is not dead.”
Even if EVs account for 50% of new cars by 2040, tens of millions of hybrid and combustion vehicles will still require engines, providing Horse with sustained market potential.
