Renault reports a loss of 8 billion euros for 2020

The French car manufacturer Renault, which includes the Dacia, Lada, Renault, Alpine and Mobilize brands, has announced a record loss of 8 billion euros for the last year compared to 2019. 

The pandemic and the economic crisis have also hit lots of large companies. The Renault group suffered from the effects of Covid-19 recording a fall in Paris trading and a drastic decrease in sales, in 2020 the French company sold 2.95 million vehicles, about 21% less than 2019. The bad economic situation was also affected by the results of the Japanese car manufacturer Nissan, of which Renault holds 44.3%, which closed the year with a loss of 5,140 million euros. 

The second half of 2020 was also marked by the shortage of crucial semiconductors and the annual turnover of the French group recorded a loss from 55.54 billion euros in 2019 to 43.47 billion euros in 2020. Luca de Meo, CEO of the Renault Group said: “2021 is set to be difficult given the unknowns regarding the health crisis as well as electronic components supply shortages”. 

The carmaker Renault has confirmed its objectives for 2023: an operating margin of at least 3% (and at least 5% by 2025); Research and Development investments and expenses of around 8% of sales business and a free cash flow of about 3 billion euros. According to the plans, by 2025 the company will launch 24 new car models on the market, including at least 10 electric vehicles, which will help achieve the goal of zero CO2 emissions by 2050. India and Latin America will be the two main international markets in which Renault will intensify its presence over the next few years. 

In mid-January, the French car manufacturer presented a new strategic plan, Renaulution, with the aim of reaffirming its competitiveness and orienting the company’s strategy towards the creation of value. Renaulution has three different phases that will be implemented in parallel: a “resurrection” phase operative until 2023 for the recovery of margin and the generation of liquidity; until 2025 the “renovation” phase will deal with the enrichment and renewal of the ranges which will also contribute to the profitability of the brands; and finally the “revolution” phase that will start in 2025 and “will shift the group’s economic model towards technology, energy and mobility, making Renault a pioneer in the new mobility value chain”. 

“We will face these challenges all together, in the recovery dynamics that have characterized us since last summer”, stated Luca De Meo.