What Renault's new EV reveals about the global auto industry

Renault's new electric Twingo fits easily into the French carmaker's portfolio.

It is a modern mini passenger car meant for urban European drivers, but it also tells a story about changes in the broader auto industry.  

Renault developed the new Twingo over a breakneck 21 months in Shanghai, following an initial design phase in France. 

The car is now in production in Slovenia, arriving this month at dealers with a price tag just under €20,000 ($23,000).

The continent-hopping Twingo is a snapshot of a hypercompetitive auto industry and its new center of gravity in China. There, many legacy carmakers are developing new models by focusing on speed, cost and technology. 

Germany's Merz seeks China reset as trade imbalance widens

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"The real competition is not China versus the West, it's fast systems versus slow systems," former Chrysler executive and car analyst Bill Russo said.

"If you want to understand where the future of the auto industry is going, you have to understand how China builds these types of products," Russo told DW. 

Automakers increasingly turning to China 

Western and Japanese carmakers like Tesla, Volkswagen and GM have long manufactured in China for the domestic and overseas markets.  

More recently, many have expanded their footprints beyond just manufacturing to designing and developing entire models in the country, hoping to benefit from the concentration of EV suppliers, expertise and its consumer base. 

Renault and Mercedes each opened expanded research facilities in Shanghai in 2024. Volkswagen built out its R&D center in Anhui province in 2025, the same year that Toyota relocated all new car development for China into the country.  

"China has become, as one supplier said, the gym of the world in terms of the automotive industry," said Alexandre Marian, a consultant with AlixPartners, a global management consulting firm.  

Yet, as they compete with their Chinese rivals overseas, legacy carmakers are under pressure to cut costs and accelerate product development in all markets — even at home.

Development cycles for new vehicles come in around two years in China, less than half the time traditionally needed by legacy automakers. Carmakers in China rely more on automation, Russo and other experts say. They run phases in parallel and they're more coordinated with suppliers and keep designs simple.  

For Russo, the smaller lead times are the byproduct of the industry's shift toward a technology-first focus.  

Updating the French 'Le Frog' in China

Renault stopped selling its brand in the Chinese market in 2020. But a visit to the Shanghai Motor Show in 2023 convinced Renault executives that it was time to develop something inside China.  

"The thing was about getting this grip on how to accelerate our procedure of development," said Oliver Laik, head of the company's A-segment cars. 

Renault's development facility in Shanghai, known as the ACDC Center, allowed the company to get close to the Chinese ecosystem and see how it works. 

The original Twingo debuted in 1992 at the Paris Motor Show, where it was quickly dubbed "Le Frog" for its compact front and round headlamps.  

Updating it as an EV was initially less attractive for Renault, Laik said. Smaller cars bring lower profit margins in Europe due to higher fixed costs. Raising the price risked pushing consumers to used vehicles or other models. 

But producing it in China — something top management quickly got behind — would cut down on costs and keep its attractive price point in Europe.

Less supplier input, but more frequent meetings 

A normal development cycle for a new Twingo would have taken Renault 42 months, Laik estimates. 

Much of that time is dedicated to vehicle validation, a testing period that stretches across multiple seasons of the year and includes exposure to different altitudes, plus driving and corrosive conditions. 

Instead of building in a lengthy development phase after the validation process, engineers at the ACDC Center worked in parallel, which meant they could address issues on an ad-hoc basis.   

No EVs without China?

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Renault changed its supplier relationship to a model known as "build to plan." 

Instead of asking suppliers for input on the model, Renault designed the parts and sent exact specifications to the manufacturers, saving both cost and time. In some cases, they even assembled supplier parts themselves, including seats.  

Back in France, the product designers also worked at a more compressed pace, says Laik. The team held more frequent meetings, and company vice presidents were updated weekly.  

Can legacy automakers bring those lessons home? 

Renault estimates that using its Chinese ADAC Center saved it 40% on costs compared to a traditional development process.  

The company plans to produce two more models in the coming months, one for its subsidiary Dacia and another for partner Nissan. And it's aiming to shave off even more development time.  

Future models will also incorporate Chinese parts, says Laik. Even Twingo's front lights came from a Chinese supplier after French and European suppliers failed to meet Renault's requirements.   

The question remains whether carmakers can replicate what they call "China speed" back in their home markets.  

Hierarchical structures, AI and software

Legacy carmakers can gain in other areas, Alexandre Marian believes, including better use of artificial intelligence and learning how to step away from hierarchical structures that draw out lead times. 

Engineers in Europe are very good and technically advanced, says Marian.

"They've developed quite a bit of knowledge, of experience, and they've developed really good cars," Marian told DW. "So, the point there is they need to change, but also by changing, they need to be a bit more empowered." 

For Bill Russo, the importance of adapting goes beyond electric vehicles and into autonomous driving and software.

"It's a pressure cooker here," Russo said. "If you're not fast, then you'll miss the opportunity." 

Edited by: Tim Rooks