In September, orders hit a 15-year high, and Renault aimed at new energy in China

China Times (www.chinatimes.net.cn) reporter Liu Kai Zhai Yanan reported in Beijing

Recently, French automaker Renault announced its third-quarter earnings report. According to the financial report, Renault Group's global automobile sales in the third quarter reached 599027 units, down 22.3% year-on-year. Among them, sales of pure electric, plug-in hybrid and hybrid models accounted for 31.3% of total sales. Renault said revenue fell 13.4 percent from 10.37 billion euros in the same period last year to 9.0 billion euros, down 13.4 percent, as rising car prices offset a 22.3 percent decline in global sales.

Europe became the main market for Renault

Renault sold 365934 cars worldwide in the third quarter. Among them, Renault's market share increased by 6% in the five major European countries (France, Germany, Spain, Italy and the United Kingdom) compared to the third quarter of 2019. Meanwhile, Renault said the company's september order volume hit a 15-year high, equivalent to 2.8 months of sales. Judging by this trend, Renault believes it is on track to meet stricter European CO2 reduction targets.

Among the segmented models, sales of the E-TECH series of electric vehicles increased by 29%, accounting for 31.3% of sales in the quarter. In addition, thanks to the launch of the new Arkana E-TECH, the Renault brand has returned to the C-class market. In terms of light commercial vehicles, the sales of MASTER and Trafic were relatively stable, and the global sales of Renault light commercial vehicles increased by 1.4% despite an 11.2% decline in overall market sales.

In addition to the Renault brand, Dacia has also made a lot of contributions. Dacia sold 128375 vehicles in the third quarter, with the new Sandero becoming the best-selling model in Europe this quarter, the Duster ranking third in the European segment sales list, and the newly launched Spring, which has now received 30,000 orders. In response, Lautlide Delbos, Chief Financial Officer of Renault, said: "Dacia Sandero is a popular low-cost city car, and the delivery waiting period is now 6 months. ”

In addition, Renault said that this year's operating margin will be roughly the same as the 2.8% reported in the first half of the year. In addition, the free cash flow of the automotive business this year (excluding changes in working capital) will also be positive. The company's planned cost-cutting plan of 2 billion euros has also been implemented and is ready to be completed in the coming weeks, more than a year ahead of the original planned completion time.

In conjunction with the earnings report, Renault said uncertainties in the fourth quarter and global semiconductor shortages could lead to a full-year cut of nearly 500,000 vehicles, more than double the forecast for early September (220,000). In response, Delbos said that the company expects the chip shortage situation in the fourth quarter to be "still not optimistic" because the information provided by suppliers is not very reliable. When asked about other raw materials, she said Renault had not suffered a shortage of other raw materials but faced rising raw material prices. Stifel analyst Pierre-Yves Quemener said that if Renault can reduce production this year to 350,000 vehicles, it will be an "achievement" for the company. "It will mean that Renault will significantly improve the current situation in the fourth quarter, which in my opinion is very, very ambitious," he said. ”

Cooperate with Geely to achieve resource exchange

Although Renault's sales in the European market are gratifying, its performance in the Chinese market is not satisfactory. Up to now, the cumulative sales volume of Jiangling New Energy, a joint venture brand established by Renault and Jiangling Group in China, is only 1840 vehicles. Therefore, in order to expand sales volume and improve profit margins, Renault has always wanted to find new breakthroughs in the Chinese market. On January 14 of this year, Renault unveiled the Renaulution framework. The framework is designed to reshape Renault's business model in China, leveraging its assets in China to focus on electric vehicles and light commercial vehicles, while leveraging China's competitive industrial ecosystem to develop new mobility solutions for China and the global market. In terms of products, Renault plans to launch 24 products by 2025, including at least 10 pure electric vehicles. For the Chinese market, we will develop models suitable for local brands.

In fact, for the Century-old Renault brand, although its share of the Chinese auto market is low, it will not go to the point of abandoning the market. In 2020, due to the stagnation of business caused by the epidemic, Renault had to adopt a strategy of shrinking its position to preserve its strength. Therefore, Renault gave up the fuel vehicle business in the Chinese market and transferred the equity of Dongfeng Renault to Dongfeng Motor Group. But Renault still has no intention of giving up the Chinese market. Luca De Meo, CEO of Renault, said: "An automaker without a Chinese presence is like a chair without legs, which is the most important market in the world. ”

Based on this, Renault retains its light commercial vehicle and new energy businesses in China.

However, with the outbreak of the global new energy vehicle market, the sales of new energy in China's market have also increased rapidly. Data show that in the first three quarters of this year, the production and sales of new energy vehicles in China were 2.166 million and 2.157 million units, respectively, an increase of 1.8 times and 1.9 times. Among them, the market penetration rate of new energy passenger cars in September was as high as 19.5%. With such a large increase, Renault naturally did not want to miss it. Therefore, in order to accelerate the landing of the "Renaulution Plan" in the Chinese market, on August 9, Renault and the Chinese private automobile group Geely Holding Group jointly announced that the two sides have signed a Memorandum of Understanding (MoU) to establish an innovative partnership, initially focusing on the development of hybrid vehicles in core fast-growing markets such as China and South Korea.

Although the two sides did not elaborate on the form of the cooperation, some clues can be seen in the memorandum of understanding signed by the two sides. Simply put, this cooperation means that Geely will provide advanced platform technology, while Renault will provide brand strategy and content. Therefore, in the cooperation, the two parties will jointly develop Renault brand hybrid models in the Chinese market based on Geely's advanced platform technology. In the Korean market, the two companies will jointly develop models suitable for the Korean market based on Lynk & Co's energy-saving platform.

In addition, both parties can use each other's resources to expand the market. Although Renault's market share in the Korean market is not high, Renault has entered South Korea in 1998, and its market layout and brand awareness in South Korea are a good "guide" for Geely to enter the Korean market.

For Renault, in addition to providing a technical platform, Geely can also give Renault a sales channel in China, and with the help of Geely's brand effect, Renault may be able to make a breakthrough in sales. This is an urgently needed resource for Renault. As for whether Renault can get out of the downturn in the Chinese market, it still needs the market reaction after the product is launched to be revealed.