Renault SA’s third-quarter sales climbed 7.6% as demand remained strong for the French carmaker’s lineup of new models such as the Austral.
(Bloomberg) — Renault SA’s third-quarter sales climbed 7.6% as demand remained strong for the French carmaker’s lineup of new models such as the Austral.
Group revenue advanced to €10.5 billion ($11.1 billion), the French company said Thursday, falling short of the €10.8 billion projected by analysts in a Bloomberg survey.
Chief Executive Officer Luca de Meo is close to completing a carve out of Renault’s electric vehicle and software business Ampere, which he aims to list in an initial public offering in the first half of next year. The IPO has been postponed once already amid lower-than-expected demand for its flagship EV, the Megane E-Tech, aggressive price cuts by US rival Tesla Inc. and competition by cheaper Chinese vehicles.
Still, Renault is counting on the introduction of 17 new models between now and 2025 to boost market share and gain momentum in the EV transition.
Renault said its order book in Europe, its main market, remains healthy with 2.5 months of forward sales at the end of September. Signs of the market softening, though, are growing, as buyers continue to grapple with high inflation that’s eroding purchasing power. Volkswagen AG said last week third-quarter EV orders fell short of its targets, forcing it to lay off temporary workers and cut shifts in German factories in recent weeks.
Renault in June upgraded its earnings forecast despite the softening market. The carmaker reaffirmed on Thursday its guidance for full-year operating margin of between 7% and 8% and automotive operational free cash flow of at least €2.5 billion.
Operating margin in the second part if the year will exceed that of the first half, which stood at 7.6%, Renault said.
As of Sept. 30, total inventories decreased to 542,000 vehicles, versus 569,000 units at the end of June. That’s in line with the objective of being below 500,000 vehicles at the end of the year, Renault said.
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