Despite the negative effect of its release from Russia, the car manufacturer begins the year with a full command book.
by Sophie Fay
Nothing can tarnish the satisfaction of Luca de Meo, managing director of Renault since July 2020. In two and a half years, he succeeded in the reversal of a group that lost 8 billion euros when he arrived, a -Al recalled. “We are three years ahead of our turnaround goal,” said the leader. The year 2022 was however still marked by a blow in April: the constrained and forced exit of the Russian subsidiary Avtovaz-Lada, which strikes the accounts of 2.3 billion euros. It is almost compensated for however by the group’s financial recovery, which limits its loss (group share) to 338 million euros for 2022.
Without Russia, net profit would have reached 1.65 billion euros. It is this figure that the leaders of Renault want to retain, as well as the doubling of the group’s operational margin, which is 5.6 % of turnover, “above the consensus of analysts”, specifies the company. This margin, greater than 6 % in the second half, should stay there in 2023, promise Renault leaders. It reaches “a record level”, the press release said. The average income by car sold increases by 33 %.
Meo’s method to succeed in this reversal is complete with the volume race for the Carlos Ghosn period. It is reminiscent of that of Carlos Tavares at PSA, then at Opel and today at Stellantis. Design platforms (chassis, axles, engine blocks and electronics) which can be used for several models (including those of Nissan or Mitsubishi) so as to lower the deadline (this level of production in Below which the company loses money), which was divided by two compared to 2019. Raise the sale price of cars by highlighting French technology. Finally, put pressure on suppliers to reduce variable costs. 2> a strategy that favors value on volumes
To implement it, the boss of Renault relies in particular on the boss of the engineering, Gilles Le Borgne, who arrived at Renault a few months before him. Luca de Meo adds his touch to it: an authentic flair in marketing, thanks to which he relaunched the Fiat 500 at Fiat and created at a new high -end brand, Cupra, at Seat (Volkswagen group).
This strategy, which favors value on volumes, made it possible to bypass what was looming as a disaster for the sector: semiconductor shortages. All car manufacturers have favored the production and sale of the most profitable models, pushing prices up, without leaving the consumer. With volumes down 5.9 %, to 2,052,174 cars (with the exception of those of Dacia, which increased), Renault’s turnover thus climbs by 11.4 %, to 46.4 billion euros. The group has also favored direct sales to individuals, ensuring funding, ceasing to sell with crossed margins to rental companies.
You have 42.62% of this article to read. The rest is reserved for subscribers.