In the first half, Renault saw its balance sheet improve with margins now close to 5%. The diamond group is still far behind its rivals Peugeot, Citroën and DS, which are stuck in the galaxy with more than 14% margin.
Will the De Meo sauce finally take place at Renault? The general manager of the French group can now breathe a little. Work continues, but some fruit is still beginning to appear on the tree, which is in the middle of construction. Last year it was time to go back to “green” for Renault, which had a very difficult financial year of 2020 with significant losses. The improvement continued in the first half of 2022 for Renault which, like many others, is finally taking advantage of the decline in sales to increase margins. And it’s been a long time now that we haven’t seen a diamond in values like this!
Also read: Spectacular margins, record term: life is good in Stellantis
Russia, the only dark place
🔴 Renault Group presents solid results for its 2022 first half results improving the financial outlook for the year with a strategy focused on the value and success of new vehicles.
Read more about H1 2022 #Financial Results below 👇 pic.twitter.com/fkWL8M2KX6
– Renault Group (@renaultgroup) July 29, 2022
In the first half, Groupe Renault scored well, led by a an average increase in sales prices and a reduction in discounts that were previously implemented on the Internet. Renault closes the range, and it shows, even if we still have to take this result for some distance. The semiconductor crisis is still hitting the auto industry, which is taking the opportunity to raise catalog prices. You only have to see the results of Stellantis to be convinced, with exceptional rates and record profits, despite a sharp decline in sales.
Groupe Renault figures for the first period
- Revenue: 21.1 billion euros, stable compared to the 1st half of 2021,
- Worldwide sales: -11.9%
- Operating margin: 988 million euros, for 4.7% of sales (+2.6%)
- Net profit: 657 million euros (excluding Russia)
A word, right, on the operating margin which is close to 5%: it includes all the sectors of the group, automobiles as well as finance and banking. If we take the car segment, it is actually 2.1%, very high compared to the first half of 2021 (+ 2.8%). Renault could also have had a better first half of the year had it not been for the Russian period, which cost the French group a lot. The sale of its operations to the Russian government resulted in the release of 2.3 billion euros, which weighed on the balance sheet (up to 1.3 billion euros in losses). Despite this, and the estimated annual production loss of 300,000 vehicles due to shortages and shutdowns in Russia, Renault expects to present a favorable balance sheet next January.
In terms of products, Renault is highlighting the success of the E-Tech range, which now represents 36% of global sales. The Arkana is undoubtedly Renault’s biggest recent success with over 100,000 orders. Mégane E-Tech has already recorded 25,000 orders. Another success is the Jogger, which is currently selling very well, with an exclusive LPG offer in the segment.