Renault to Focus more on Technology with New CEO
Under the guidance of their new CEO - Luca de Meo, Renault plans to focus more on technology as part of its business revival.
De Meo announced Thursday he would cut an extra 500 million euros in costs and focus on producing a smaller number of profitable models. Car production will drop to 3.1 million vehicles by 2025 from 4 million in 2019, while half of new launches will be electrified, including a revamped version of the Renault Super Cinq model.
The plan is focused on efficiency, aimed at dealing with the tough COVID-19 pandemic times and ex-CEO’s mismanagement.
"We grew bigger, but not better”, de Meo said in an online presentation, adding the task now was to "steer our business from market share to margin".
Investors were not very impressed with the choice, however, with Renault shares falling 3% in morning trade. Jefferies analyst - Philippe Houchois described the new profit targets as "underwhelming," reflecting the "depth of challenges at Renault."
Truth be told, long before the COVID-19 pandemic, Renault was already struggling to adjust to life without Ghosn - the long-time boss of its alliance with Japan's Nissan, following Ghosn’s arrested in Japan in November 2018 on financial misconduct charges. With the European Union further tightening emissions regulations and rivals PSA and Fiat Chrysler Automobiles NV completing their merger to create Stellantis - the world's fourth-biggest automaker, Renault does indeed have a lot of catching up to do.
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