Renault has posted third-quarter Group revenue down 6% to EUR11.5bn (US$13.2bn), partly due to currency devaluation and the automaker’s withdrawal from Iran, although registrations rose 2.9%.

In Europe, Group registrations increased by 8.6% in a market up 0.8%, mainly due to the B segment models (Clio, Captur) and C segment models (Mégane and New Duster). In the electric vehicle segment, Zoe recorded registrations up 7% and Kangoo ZE doubled its sales.

Outside Europe, in a market down 3%, Group registrations decreased by 2%, including Jinbei and Huasong (-10.4% excluding Jinbei and Huasong).

In the Americas, Group registrations were up 0.2% despite the fall in the Argentinian market (-24.9%). In Asia-Pacific, the increase was 72%, including Jinbei and Huasong (-14.8% on an equivalent basis in 2017).

The Group faced a slowdown of its registrations in Africa, Middle East, India (-24.4%) and Eurasia (-5.6%) regions. The Africa Middle East India region was mainly impacted by a decline in India (-34.7%) and in Iran, where activity was stopped. In Eurasia, registrations continued to increase in Russia (+5.0%), but Turkey sales were down 52.5% in a market down 51.3%.

Third quarter revenues by operating sector:

In the third quarter of 2018, Group revenues reached EUR11.5bn, (-6%). At constant exchange rates, Group revenues decreased by 1.4%.

As of January this year, the Group changed the allocation of interest rate subsidies between operating segments, with no impact on consolidated revenues. On a comparable basis, Automotive excluding AvtoVAZ revenues would have been EUR142m higher, offset by an equal decrease in Sales Financing revenues.

Automotive excluding AvtoVAZ revenues amounted to EUR10.1bn , down 8.4%. Beyond the negative 1.3 points effect mentioned above, revenues were negatively impacted by the sharp devaluation of the Group’s main currencies (Argentinian peso, Brazilian real, Turkish lira, Russian ruble), which led to a negative currency effect of 4.0 points.

The pricing policy notably implemented in these countries led to a positive price effect of 1.6 points. The volume effect weighed in at -2.6 points, mainly due to the fall in the Turkish and Argentinian markets and a destocking of the dealer network in the third quarter.

The decline in sales to partners impacted revenues by -3.3 points due to the stoppage of deliveries to Iran, lower demand for diesel engines and lower production for Nissan.

AvtoVAZ contribution to Group revenues amounted to EUR627m in the quarter, down 1.1%, after taking into account a negative exchange rate effect of -EUR79m. At constant exchange rates, revenues would have been up 11.4%.

Outlook 2018:

The global market is expected to grow 2% compared to 2017 (previously +3%). The European market is expected to expand more than 1.5% (versus +1.5%) with an increase of more than 4% for France (versus +2%).

Outside Europe, Brazil is expected to grow by 10% and Russia by more than 10%. China is expected to grow by 2% (versus +5%), and India by 8%.

Within this context, Groupe Renault confirms its guidance:

  • – Increase Group revenues (at constant exchange rates)
  • – Maintain Group operating margin above 6%
  • – Generate a positive Automotive operational free cash flow