PARIS, (Reuters) – Renault confirmed on Wednesday that the company’s joint venture with Chinese automaker Brilliance Auto Group has run out of money and was heading towards a restructuring.

“In light of (the JV’s) inability to meet its current financial obligations, the company’s board of directors has resolved to initiate a restructuring process,” a spokesperson said.

Reuters received information from a source in September. Renault (PA) had been in negotiations to end the joint venture it was forming to build vans for China-backed state company.

It all started in 2017 when Renault and Brilliance China Automotive Holdings Ltd set up manufacturing in Shenyang. They wanted to expand their reach into electric commercial vans and in particular, to produce them in Shenyang.

Some foreign manufacturers have had difficulty selling in China, as sales plummeted right before the COVID-19 epidemic that decimated the sector.

Renault ended its passenger car business in China last year after poor results at Dongfeng Motor Group’s loss-making venture. It is now trying to break into the market again with Geely Holding Group. In August, it announced a joint venture for hybrid vehicles.

Bloomberg reported earlier Wednesday that French automaker Renault had initiated a process of restructuring.