Renault teams up with Thales to boost France's drone production

By Gilles Guillaume and Florence Loeve

PARIS, June 16 (Reuters) - France's Renault Group will produce military drones with defence technology firm Thales, the companies said on Tuesday, marking a further push by the automaker into defence manufacturing.

Renault will build Thales' Toutatis remotely operated loitering munitions at one of its factories, with production of 1,000 units a month starting as early as next year, and targeting mainly overseas markets.

The agreement, announced at the Eurosatory defence fair outside Paris, is the second partnership in defence between the two groups, which are also working together on a military vehicle. 

The companies said the deal would significantly ramp up France's industrial capacity in a strategic area. Loitering munitions - drones that hover over a target area before striking - have played a central role in the war in Ukraine.

"We started with the military need," said Thales CEO Patrice Caine. "We closely examined what's happening in a number of theatres of operation, particularly in the East, but not exclusively."

Russia's invasion of Ukraine and a shift in U.S. foreign policy under President Donald Trump have driven European countries to boost defence spending, prompting arms makers to tap spare capacity in the auto sector to increase output.

SCALING UP DRONE PRODUCTION

Renault said in February it had been asked by France's armed forces ministry to help strengthen the country's defence sector.

Renault's industrial expertise will help scale up drone production more quickly and at lower cost, CEO Francois Provost said.

Thales currently produces around 100 units of the Toutatis drone per year. The partnership with Renault will increase output by switching from 3D printing to larger-scale plastic injection molding, with the drone's design being adapted to allow for the higher production volume. A 40% reduction in the number of parts and fasteners will also help lower costs, said Provost.

Asked about the cost of the new munition compared to others on the market such as the Damocles from KNDS and Delair, or the Akeron RCX 50 from MBDA, Caine said that it was "super competitive".

There are currently no firm plans for France to purchase significant volumes of the drones, added the companies, with higher needs in other markets.

The short-range drone project adds to Renault's Chorus programme with drone maker Turgis Gaillard to develop a long-range model. A first demonstrator is expected by the end of this year, followed by monthly output of 600 drones at Renault's Le Mans plant.

Renault has said making cars remains its core business, though it is also working with Belgian group John Cockerill on a ground drone. John Cockerill Defense bought French military vehicle maker Arquus from Swedish truck manufacturer Volvo in 2024.

(Reporting by Gilles Guillaume and Florence Loeve. Writing by Dominique Patton; Editing by Mark Potter and Emelia Sithole-Matarise)