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While Q3 2020 saw a slight recovery in the global automobile market with a -4.0% drop compared with a -28% decline in the first half of the year, Groupe Renault under-performed at 806,320 vehicles sold – down -6.1% compared with the third quarter of 2019. The Renault brand continues to nurture electric vehicles and is now accelerating the launch of the E-TECH hybrid and plug-in hybrid line-up in Europe as automakers are designing to government regulations, not customer demand.
“This third quarter highlights the change in our commercial policy, which now focuses on profitability rather than volumes.” Our EV performance, our E-TECH hybrid models which have been very well received…” claimed Luca de Meo, CEO of Renault. Group revenues reached €10,374 million (-8.2%) in the quarter. The assertion comes as Covid-19 patients in hospitals in Europe is still less than half of the peak in March and April, but it is rising each week, according to data from the European Centre for Disease Prevention and Control. People across much of Europe — including larger countries like France, Italy, Poland and Spain — are now more likely to be hospitalized with Covid than those in the US.
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In a European market down -5.0%, the Group maintained its good momentum, with 405,223 units sold in the third quarter (-2.9%). Market share increased by 0.2 points to 10.3%. Sales of the Renault brand rose 0.8% thanks to the success of Clio, Captur and ZOE, each lead in their respective categories. Sales of the Dacia brand were down -9.9% mainly due to a high comparison base in the third quarter of 2019.
EVs – ZOE First in a Growing Market
The Renault brand is the European leader in electric vehicles in a market up 107.2%. ZOE is the best-selling electric vehicle, with sales up 157.4% to more than 27,000 units over the quarter
Outside of Europe Group sales were down -9.0%, hurt by a -50.9% drop of sales in Brazil due to the strong fall of the market and a change in the commercial policy favoring profitability over volumes.
In Russia, Groupe Renault’s second largest market, LADA was up 4.5% over the quarter in a market up 3.7%. Groupe Renault is the leader with 28.8% market share, driven by LADA Granta and LADA Vesta, the two best-selling vehicles on the market.
In Turkey, in a market experiencing a strong recovery (+178.0%), Groupe Renault increased its sales by 131.1% in the third quarter compared with 2019.
Q3 Revenues By Sector
In the third quarter of 2020, Group revenues reached €10,374 million (-8.2% compared to last year). At constant exchange rates, Group revenues would have decreased by 3.2%.
Automotive excluding AVTOVAZ revenues amounted to €8,948 million, down -7.4%. This decrease is from a drop in volumes (-6.8 points), partly due to inventory adjustments.
- Sales to partners dropped by -3.3 points explained by lower vehicles and components production for our partners.
- The currency effect was negative- 4.2 points stemming from the Group’s exposure to emerging markets.
- The price effect, positive +5.5 points, came from increases to cover currency devaluations and our pricing discipline policy.
- The product mix was positive +1.1 points and mainly reflected the increase in ZOE sales. The “other” effect had a positive contribution of 0.3 points.
- AVTOVAZ contribution to Group revenues amounted to €663 million in the quarter, down -16.2%, after considering a negative exchange rate effect of €153 million. At constant exchange rates, AVTOVAZ contribution would have been up 3.2%.
- Mobility Services contributed €5 million to third-quarter 2020 revenues.
- Sales Financing (RCI Banque) posted revenues of €758 million in the third quarter, down 10.1% compared to 2019.
Automotive activity on September 30, 2020 held €15.2 billion of liquidity reserves which include the €5 billion credit facility agreement benefiting from the guarantee of the French State of which €3 billion euros have been drawn down by the end of September 2020. Liquidity reserves were down €1.6 billion from June 30, mainly due to the seasonality of working capital requirements and debt repayments. Nonetheless, Groupe Renault should achieve a positive Automotive operational free cash flow for the second half of the year.
About Ken Zino
Ken Zino, editor and publisher of AutoInformed, is a versatile auto industry participant with global experience spanning decades in print and broadcast journalism, as well as social media. He has automobile testing, marketing, public relations and communications experience. He is past president of The International Motor Press Assn, the Detroit Press Club, founding member and first President of the Automotive Press Assn. He is a member of APA, IMPA and the Midwest Automotive Press Assn.
He also brings an historical perspective while citing their contemporary relevance of the work of legendary auto writers such as Ken Purdy, Jim Dunne or Jerry Flint, or writers such as Red Smith, Mark Twain, Thomas Jefferson – all to bring perspective to a chaotic automotive universe.
Above all, decades after he first drove a car, Zino still revels in the sound of the exhaust as the throttle is blipped during a downshift and the driver’s rush that occurs when the entry, apex and exit points of a turn are smoothly and swiftly crossed. It’s the beginning of a perfect lap.
AutoInformed has an editorial philosophy that loves transportation machines of all kinds while promoting critical thinking about the future use of cars and trucks.
Zino builds AutoInformed from his background in automotive journalism starting at Hearst Publishing in New York City on Motor and MotorTech Magazines and car testing where he reviewed hundreds of vehicles in his decade-long stint as the Detroit Bureau Chief of Road & Track magazine. Zino has also worked in Europe, and Asia – now the largest automotive market in the world with China at its center.
Groupe Renault Q3 Revenues -8% at €10,374m, Sales -6%
Click to Enlarge.
While Q3 2020 saw a slight recovery in the global automobile market with a -4.0% drop compared with a -28% decline in the first half of the year, Groupe Renault under-performed at 806,320 vehicles sold – down -6.1% compared with the third quarter of 2019. The Renault brand continues to nurture electric vehicles and is now accelerating the launch of the E-TECH hybrid and plug-in hybrid line-up in Europe as automakers are designing to government regulations, not customer demand.
“This third quarter highlights the change in our commercial policy, which now focuses on profitability rather than volumes.” Our EV performance, our E-TECH hybrid models which have been very well received…” claimed Luca de Meo, CEO of Renault. Group revenues reached €10,374 million (-8.2%) in the quarter. The assertion comes as Covid-19 patients in hospitals in Europe is still less than half of the peak in March and April, but it is rising each week, according to data from the European Centre for Disease Prevention and Control. People across much of Europe — including larger countries like France, Italy, Poland and Spain — are now more likely to be hospitalized with Covid than those in the US.
Click to Enlarge.
In a European market down -5.0%, the Group maintained its good momentum, with 405,223 units sold in the third quarter (-2.9%). Market share increased by 0.2 points to 10.3%. Sales of the Renault brand rose 0.8% thanks to the success of Clio, Captur and ZOE, each lead in their respective categories. Sales of the Dacia brand were down -9.9% mainly due to a high comparison base in the third quarter of 2019.
EVs – ZOE First in a Growing Market
The Renault brand is the European leader in electric vehicles in a market up 107.2%. ZOE is the best-selling electric vehicle, with sales up 157.4% to more than 27,000 units over the quarter
Outside of Europe Group sales were down -9.0%, hurt by a -50.9% drop of sales in Brazil due to the strong fall of the market and a change in the commercial policy favoring profitability over volumes.
In Russia, Groupe Renault’s second largest market, LADA was up 4.5% over the quarter in a market up 3.7%. Groupe Renault is the leader with 28.8% market share, driven by LADA Granta and LADA Vesta, the two best-selling vehicles on the market.
In Turkey, in a market experiencing a strong recovery (+178.0%), Groupe Renault increased its sales by 131.1% in the third quarter compared with 2019.
Q3 Revenues By Sector
In the third quarter of 2020, Group revenues reached €10,374 million (-8.2% compared to last year). At constant exchange rates, Group revenues would have decreased by 3.2%.
Automotive excluding AVTOVAZ revenues amounted to €8,948 million, down -7.4%. This decrease is from a drop in volumes (-6.8 points), partly due to inventory adjustments.
Automotive activity on September 30, 2020 held €15.2 billion of liquidity reserves which include the €5 billion credit facility agreement benefiting from the guarantee of the French State of which €3 billion euros have been drawn down by the end of September 2020. Liquidity reserves were down €1.6 billion from June 30, mainly due to the seasonality of working capital requirements and debt repayments. Nonetheless, Groupe Renault should achieve a positive Automotive operational free cash flow for the second half of the year.
About Ken Zino
Ken Zino, editor and publisher of AutoInformed, is a versatile auto industry participant with global experience spanning decades in print and broadcast journalism, as well as social media. He has automobile testing, marketing, public relations and communications experience. He is past president of The International Motor Press Assn, the Detroit Press Club, founding member and first President of the Automotive Press Assn. He is a member of APA, IMPA and the Midwest Automotive Press Assn. He also brings an historical perspective while citing their contemporary relevance of the work of legendary auto writers such as Ken Purdy, Jim Dunne or Jerry Flint, or writers such as Red Smith, Mark Twain, Thomas Jefferson – all to bring perspective to a chaotic automotive universe. Above all, decades after he first drove a car, Zino still revels in the sound of the exhaust as the throttle is blipped during a downshift and the driver’s rush that occurs when the entry, apex and exit points of a turn are smoothly and swiftly crossed. It’s the beginning of a perfect lap. AutoInformed has an editorial philosophy that loves transportation machines of all kinds while promoting critical thinking about the future use of cars and trucks. Zino builds AutoInformed from his background in automotive journalism starting at Hearst Publishing in New York City on Motor and MotorTech Magazines and car testing where he reviewed hundreds of vehicles in his decade-long stint as the Detroit Bureau Chief of Road & Track magazine. Zino has also worked in Europe, and Asia – now the largest automotive market in the world with China at its center.