After three years of implementing the recovery plan, Renault in great shape

Having left the emergency room, according to the expression chosen last year by Luca de Meo to describe the company, Renault is now in Olympic form to begin a long-distance race. Last year, the group saw its sales increase by 17.9%, to 52.4 billion euros. Its net profit reached 2.3 billion euros.

Its coffers swelled by 905 million euros in liquidity in 2023 compared to the previous year to reach 3 billion euros. The operating margin jumped to 7.9%, a record for the group. “We have achieved the fastest turnaround in the history of the automotive industry,” says the group’s CEO.

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With his teams, Luca de Meo compared the recovery of Renault with the turnarounds of Nissan in 1999 under the aegis of Carlos Ghosn, that of Fiat when he worked there alongside Sergio Marchionne, and even that of PSA after Carlos Tavares came to his rescue in 2013-2014. “ When you look at the numbers, you see we had a pretty impressive speed of execution. Now we must continue to make this performance sustainable,” underlines the manager.

Is Renault now strong enough to cope with the decline in demand for cars and the aggressive price war launched on all continents, with Chinese manufacturers setting out to conquer the West? Luca de Meo is surprised that we can doubt it: “Why is there always a kind of doubt hanging over Renault? We have been making steady progress for three years. This is the third year that we have performed better than we promised. » The operating margin actually increased from 2.8% in 2021 to 7.9% in 2023. And the group remains on its cautious line, announcing a margin higher than 7.5% in 2024.

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In three years, the group's managers have been able to face a series of crises: a market falling by 35% after Covid, a lack of electronic components, the cessation of activities in Russia (including the sale of the manufacturer Avtovaz) .

At the same time, the war with Nissan was buried with a rebalancing of shareholdings. The Renault group has reorganized around different technologies. Horse, the equipment manufacturer dedicated to components for thermal and hybrid engines, of which the Chinese Geely holds 50%, was deconsolidated from Renault last summer. Ampere, its electrical and software division, was born in November. At the end of January, Luca de Meo announced that he was abandoning his IPO due to a sluggish stock market for electric automobile stocks. Not enough to shake the outlook, according to the manager: “We are going to launch 15 to 20 cars by 2026. This cycle of new products will increase our market share. It is now our turn to benefit from this growth. »

But despite this in-depth work carried out over the last three years to “revolutionize” Renault, the market capitalization remains unchanged. Renault was worth 11 billion euros on the stock market in February 2022, like two years later. The commercial success of the new electric R5 will probably not be enough to restore color to the Losange.