Renault presents its strategy towards a Next Gen automotive company

  • Significantly ahead of its initial targets, Renault Group opens the third chapter of its Renaulution plan: Revolution
  • Renault Group revolutionizes itself focusing resources on the value chains arising from the transformation of the automotive and mobility industry: electric vehicles (EV), software, new mobility services, circular economy, in addition to ICE & hybrid vehicles
  • Renault Group aims at becoming a Next Gen automotive company built on 5 focused businesses addressing all the new value chains:
  • Ampere: the first EV & Software pure player born from an OEM disruption
    • Alpine: a high-end zero-emission global brand with a racing pedigree. A unique asset-light model combined with proprietary technologies
    • Mobilize: built around a financial services company to enter the market of new mobility, energy and data-based services
    • The Future Is NEUTRAL: the first 360° circular economy company in the automotive industry from closed loop in materials to battery recycling
      • Power: the traditional core business of Renault Group will continue to develop innovative low emissions ICE & hybrid vehicles under the Renault, Dacia and Renault LCV brands, each with their dedicated organization and governance. To reinforce and project this part of the business into the future, we announce the creation of a worldwide Tier 1 supplier of ICE & hybrid powertrain technologies (Horse project)

Building an open partnerships ecosystem to enable future growth:

  • By creating such powertrain technology company, Renault Group and Geely are combining their technological, manufacturing and R&D assets. Renault Group will own 50% of this company representing revenues of €15 billion globally from Day 1
  • Ampere: envisaged IPO on Euronext Paris earliest H2 2023 (subject to market conditions) with Renault Group keeping strong majority and the support of potential strategic cornerstone investors (including Qualcomm Technologies)
  • Renault Group has built deep partnerships with 2 major tech players, Google and Qualcomm Technologies, to create game-changing technologies that will enable the development of Software-Defined Vehicle (SDV) including Centralized Electronic Architecture and Car OS
  • Alpine is set to expand globally with half of its future growth outside of Europe leveraging commercial partnerships and investors support. Alpine is open to capitalize on the financial valuation of its F1 Team assets
  • Light Commercial Vehicles (LCV) to launch, in partnership with an OEM, a game changing EV & software-defined family of vans: FlexEVan. It allows real-time, end-to-end operations monitoring and data-driven fleet management. FlexEVan’s disruptive concept and technology will ensure -30% total cost of usage for mobility operators

Solid financial outlook entering in a new era:

  • Financial outlook 2025-2030:
    • Operating margin: above 8% in 2025 and above 10% by 2030
      • Free cash-flow: above €2 billion per year on average over 2023-2025 and above €3 billion per year on average over 2026-2030
    • Dividend policy: Renault Group plans to restore dividend payment from 2023 (for 2022 FY – pending Shareholders’ General Meeting approval). This dividend policy, a first for Renault Group, will gradually grow, in a disciplined manner, up to 35% payout ratio of Group consolidated net income – parent share, in the mid‑term. To do so, the Group must achieve its first priority: return to an investment grade rating
    • Ambition to grow employees’ shareholding to 10% by 2030

Announcements are a new sign of Renault Group team’s determination to prepare the company for the future challenges and opportunities generated by the transformation of our industry. After having executed one of the fastest and unexpected recovery plans, after having prepared the company for growth by securing the development of the best product line-up in decades, we intend to position ourselves faster and stronger than competition on the new automotive value chains: EV, software, new mobility and circular economy. We focus full-fledged teams on each of the automotive and mobility value chains. We design an agile and innovative organization to manage the volatility and fast technological evolution of our times. Speed, accountability, transparency, and specialization for excellence are the key words. Renault Group is one team of teams, benefiting from simplified governance and digital management platforms boosting collaboration and breaking silos typical of traditional organizations. Allocating up to 10% of the capital to our employees, will contribute to foster a new common culture oriented to value creation. We believe also in cooperation when it comes to invest, create and scale new businesses and technologies. This is the core of our horizontal approach, and the network of partners that are participating in our different projects, is the proof of the quality of our initiatives. All this is one of the most progressive re-engineering projects of the recent years in our industry, a Revolution in its kind“. said Luca de Meo, Chief Executive Officer of Renault Group.

“What the Group has achieved in terms of financial turnaround in just 2 years is outstanding and we will not stop here. We are bringing our non-negotiable fundamentals – value over volume, competitiveness, and capital efficiency – to the next level. This new corporate architecture will allow us to improve our financial performance, targeting benchmark profitability, free cash-flow generation and return on capital employed. By addressing structurally more profitable value chains, it will transform our business mix and create valuePowered by the focus on growing and cash generating businesses, our plan is ambitious but also realistic in the light of the current macroeconomic context. The Renaulution plan foundation is self-financed but will be accelerated by external fundings and partnerships enabling the access to key value chains, to boost growth and innovation while reducing capital requirements. All in all, the Revolution is also financial and aims at creating value for all our stakeholders as illustrated by our dividend policy and our target to reinforce employee shareholding”. said Thierry Piéton, Chief Financial Officer of Renault Group.