Record loss in the Corona year: Renault loses eight billion euros

Record loss in the Corona year
Renault loses eight billion euros

Delivery failures and decreased demand: The Corona crisis is causing problems for car manufacturers. Renault was hit particularly hard last year. Sales and car sales for the French collapse. The group is also concerned about further production.

The French car maker Renault sees signs of a trend reversal after a billion-dollar loss in the Corona year 2020. In the second half of the year, sales picked up somewhat and the profit margin improved, the company said. Thanks to price increases for some models, the group made money again in the third and fourth quarters. Sales continued to decline, but not as strong as before.

The new Renault boss Luca de Meo wants to bring the carmaker back on the road to success with sharper austerity measures and the conversion to a software-driven technology group. Renault is making better progress than expected when it comes to reducing fixed costs by two billion euros, he said. The goal could be achieved by the end of the year.

Chip production uncertainty factor

At the same time, de Meo agreed that 2021 should be another difficult year, not least because of the chip shortage, which is currently affecting the automotive industry worldwide. The chip crisis could peak in the second quarter, affecting production of 100,000 cars.

Renault 38.11

However, the situation is difficult to assess and is changing from hour to hour, the company said. Bottlenecks in important semiconductor products such as electronic chips and sensors are also alarming the German automotive industry.

Margin target: 3 percent

In 2020, Renault, like the rest of the industry, suffered from the Corona measures. The bottom line was a record loss of eight billion euros. The minus is bigger than analysts expected. In the previous year the deficit was 141 million euros. In 2020, sales fell by a good fifth to 43.5 billion euros.

The French company sold 2.95 million vehicles last year, a decrease of 21.3 percent. As in the previous year, the French car company does not want to pay a dividend. The Group reaffirmed the last-mentioned goals for the coming years. An operating margin of more than 3 percent is to be achieved in the group by 2023.

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