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The Caterham-Alpine tie-up (2016): who benefits most?

By Ollie Kew

Analysis

06 November 2012 14:00

Caterham now owns a 50% share in rally legend Alpine, and will from 2015 sell a brand new sports car co-developed with Renaultsport.

It’s fighting talk from Caterham, which only sells around 500 cars a year currently. At least Caterham's sales are stable, which is more than can be said for Renault, currently in the midst of freefalling sales in the dead-on-its-feet French car market. The French marque's sales dropped 13% in the third quarter of 2012, according to industry source Automotive News Europe.

But is the new Caterham-Alpine joint venture a true win-win for both brands? And what does it mean for car enthusiasts?

Caterham-Alpine joint venture: let’s start with the good news

There’s plenty of it: a pair of new sports cars join the market in 2016, priced around £30-£45k (in order to remain affordable according to ex-Caterham CEO Ansar Ali). Both the Alpine and Caterham will employ lightweight materials inspired by Caterham’s F1 team, and team boss Tony Fernandes also wants to see F1-style aerodynamics and KERS boost systems making an on-road appearance. With engineering input from the bods at Renaultsport - makers of some of the finest hot hatches on the planet - there's real potential for a series of great drivers' cars to emerge from the Alpine deal.

Also, Caterham enjoys the security of a big-brand partnership, and gets to keep the Seven British-built without overstretching its UK resources. And in future the Caterham Seven could use Renaultsport components if they’re deemed enough of an improvement over today's Ford-sourced engines. A 1.6-litre 200bhp turbocharged Seven sharing an RS Clio engine? It could happen…

Meanwhile, Renault’s Dieppe factory gets a new lease of life, the 300 employees have safeguarded jobs, and both Renault and Caterham will burst onto the East Asian scene, fuelled by Tony Fernandes’ understanding of how to market products in the area. With volumes for each brand expected to hit 2500 per year, it’s a welcome bottom-line boost at a time when car sales are flatter than Caterham F1’s title hopes.

Incidentally, Fernandes doesn’t think the back-maker team undermines the appeal of an F1-inspired road car, but did admit the team's current F1 standing made for ‘boring and tedious’ competition. Wearing his green and yellow team branded baseball cap, Fernandes told CAR that a Renault-Caterham F1 team would ‘make sense’ given the Alpine alliance, and he would soon make way for a new team principal while he concentrated on the road car project.

What could go wrong with the Renault-Caterham alliance?

Both Tony Fernandes and Renault CEO Carlos Ghosn see this tie-up as the start of an ongoing joint venture, rather than a one-off. Indeed, Fernandes has defied Caterham suits who believe the company is best suited to niche status, by pushing ahead with plans to develop a diverse model range, citing Porsche as inspiration. It sounds worryingly like the ill-fated Dany Bahar-inspired five-car plan at Lotus, which has brought Hethel to its knees.

Fernandes himself notes the madness of the Lotus ambition, and stressed any Caterham progression would be more measured and patient, but the man is an unashamed profit-chaser, and if he sniffs expansion in Caterham, it will be pursued.

Of course, Renault and Caterham are also banking heavily on a return to prosperity by the time the new models roll off the Dieppe production line in three to four years’ time. Although eastern markets are a seeming dead cert for sales, a strong European fan base is invaluable for the project's credibility.

Overall, it's Caterham who has most to gain from the venture, but given its current small but profitable status, it also has, arguably, the most to lose.

>> What’s your verdict on the winners and losers in the Caterham-Renault alliance? Give us your comments below