Renault boss Carlos Ghosn has said the group is maintaining its 2008 growth targets but he also warned the next few months would be difficult in an “unfavourable environment.”
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“We’re sticking to our objectives of a 4.5 percent operating margin for 2008… and we are maintaining our volume growth projection of more than 10 percent,” Ghosn told a Renault shareholder general assembly.
“The first months of the year have not been easy. Everything suggests that the next few months will not be either, given an economic and financial environment that is both unfavourable and volatile.”
The European car market will contract in 2008, he said. However, Ghosn maintained that the “slack in mature auto markets will be more than offset by strong demand from emerging markets Brazil, Russia, China and India, so the global car market as a whole will grow.”
However, Ghosn cautioned that the time isn’t right for the company to launch Renault in China, because the company is already stretched with projects in countries such as Russia, Iran, India and Morocco.
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By GlobalData“Even if we had a really good project [for China] I’m not sure we could go through with it. You can’t go into China in a halfhearted way; you have to put all your other projects aside.”
He also said Renault was at a disadvantage because of the rise of the euro, which makes its products more expensive and less competitive on world markets.
In addition, “the hike in raw materials prices has been stronger than foreseen”.
Ghosn also said that the company will benefit from an ongoing product offensive that is the fruit of heavy investment by Renault over the past two years.
