Carlos Ghosn, CEO, right, and Patrick Pélata, Chief Operating Officer face another challenging year of cost cutting.
Renault SA reported a net loss of €3.1 billion ($4.3 billion) compared with a €571 million profit a year earlier — its first annual loss in 13 years, as the global Great Recession exacted it toll in spite of drastic cost cutting of -17% compared to 2008.
Revenue fell 11% to €33.7 billion.
The French automaker posted a €396 million-euro operating loss, excluding one-time items, compared with a profit of €326 million in 2009. The operating loss at the auto division increased to a breathtaking -€915 million from €174 million.
It was the first loss since the formerly government-owned automaker was privatized.
Last year, Renault and the leading French maker, Peugeot, each received €3 billion euros in government loans to help them through recession in exchange for a pledge to protect French jobs, a promise whose sincerity is now being questioned by critics.
The Renault Group reported revenues of €33,712 million, down 11% year-on-year, but up 25% in the last quarter. Peugeot has reported a €1.2 billion euro net loss on sales of €48.4 billion, down 11% from 2008.
“Economic conditions will remain difficult in 2010 with a 10% fall in the European market,” said Carlos Ghosn, Chairman and CEO of Renault. “We are continuing our work on building the Renault of the post-crisis period with the pursuit of the sales offensive in Europe, the mass market of zero-emission vehicles in 2011, the extension of the Entry-car range, the strengthening of our presence in emerging countries, and the acceleration and broadening of synergies with Nissan.”
In spite of launching six new products in 2009, the Group’s marketshare was flat, +0.1 point to a 3.7% global share. Still, this is a comparative victory since global sales of passenger cars and light commercial vehicles decreased by 4.5%.
Renault expects economic conditions to remain “difficult” in 2010.
Renault’s objectives for this year are to maintain positive cash flow and to continue to reduce debt – the same as last year’s.
Renault will introduce six new products in 2010, as well as continuing synergies with loss-making Alliance partner Nissan, where Renault holds a 44% stake. Last year synergies were reported as €1.5 billion. The goal is for another €1 billion in savings for 2010.
Within the next three years, 12 additional models will be cross-manufactured by Nissan Renault, twice as many as today, according to Ghosn — five models in Russia, five in India, one in Brazil and one in Mexico.
- As to new models this year, a new SM5 from Renault Samsung was just revealed in South Korea. Outside Korea, the car will mainly be sold in Asia and the Middle East.
- Dacia will have a new Duster SUV that is said to be a genuine off-road four-wheel-drive vehicle.
- Two convertibles will also be launched next summer, with the new Renault Megane Coupé Cabriolet and Wind.
- In March, Renault freshens its large van range with a new Master, in both front and rear-wheel-drive versions.
- Kangoo’s range will be expanded with a bigger-sized model.
- The Trafic will get a mid-cycle change.
“In conclusion, we consider 2010 to be another challenging year for our industry.” said Ghosn. This is why we maintain our focus on free cash flow and debt reduction.”