Renault renounces volumes to prefer value



From volume to value “: It is with this simple expression that, Thursday, January 14, Luca de Meo, CEO of the Renault group, summarized the new strategic plan,” Renaulution “. The latter, intended to redress the manufacturer which had experienced its first losses for more than ten years in 2019, is structured in three phases, launched in parallel.

Less volumes, more margins

The first phase, “Resurrection”, is to extend until 2023 and aims to redress margins and generate liquidity. The manufacturer will no longer measure its performance through market share and sales, but according to the profitability and efficiency of the investments. ” We have expanded all over the world but in several areas our margins are low, details Luca de Meo. Three quarters of the profits, currently, are linked to Europe, and half are concentrated in only five countries “.

By 2023, the Group aims to achieve more than 3% of the group operating margin, explains the Financial Director of the Clotilde Delbos Group, and around three billion euros in operational free cash flow “. Each brand will be accountable for its profitability. By 2025, management expects a fifteen point increase in the return on invested capital.

Industrial capacities, which were four million vehicles annually in 2019, are expected to be reduced to 3.1 million by 2025. The number of platforms (the basic structure of the car) will continue to be reduced, with the Renault group still waiting. more synergies arising from its alliance with Nissan on that side. Research and development investments and expenses are expected to increase from 10% to 8% of turnover in 2025.

14 Renault models expected by 2025

Despite the planned cost reductions, Renault does not forsake the product, which is the subject of the second phase, “Renovation”. 24 new model launches are planned by 2025, including 14 for the Renault brand alone. Among the latter, seven will be 100% electric and seven in the C and D segments. The first of these two segments is that of compact sedans, which cannot be ignored by any generalist manufacturer with the ambition to remain on the continent. European.

However, it is with a prototype car of the B segment, that of city cars, that the manufacturer wants to create the buzz. By imagining one following the Zoe, Renault presented a prototype of Renault 5, some elements of which allude to the flagship model of the 1980s. A commercial tactic already tested by others, like Fiat when it had revamped of the day the label “500” – under the leadership of Luca De Meo -, or BMW, owner of “Mini”.

An electric R5

Under the hood of the new R5, on the other hand, a 100% electric engine. If Luca de Meo did not specify the industrial sites likely to assemble the production model which could result from it, it is a safe bet that the Douai plant is subject to its assembly.

Dacia, whose sales dropped significantly last year due to the lack of a new model launch, also presented a prototype, SUV type (raised car). The original Romanian brand is associated with the Russian Lada in a common entity, although both brands will continue.

The Group no longer just wants to sell cars

The third phase, “Revolution”, projects the group into its medium-term future, with the ambition of generating more than 20% of its income outside of the sale of new vehicles alone, by 2030. Mobilize is the new entity sales representative to develop the various services, covering the future of the Flins plant, which will specialize in extending the lifespan of vehicles – if necessary by changing their type of propulsion.

Mobilize must support the transformation of the automotive world from ownership to use », Underlines Clotilde Delbos. The car-sharing fleets, which Renault launched in Madrid and then Paris, will be under his responsibility, as will all development projects linked to what Luca de Meo calls the “Software Republic”, which he describes as an ecosystem open to development. know-how in data processing and cybersecurity. The automaker dreams of being a developer of high-tech service to be used in the car … and outside.

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