Alliance With Daimler Might Include Electric Cars
Despite sales in Europe slipping in the first half, Renault global sales rose a bit, and in the second half of the year the company expects to shake itself free of the Japanese tsunami problems which hampered supply of some diesel engines.
Investors like Bank of America Merrill Lynch retain their support of Renault, not least because its low share price promises upward traction.
“Renault remains our preferred play among mass OEMs. A complete entry range offer, solid positions in emerging markets notably South America, Russia, North Africa and Turkey, the benefits of the Nissan Alliance from scale and cash perspectives and relative valuation remain the key reasons for our relative preference for Renault among European mass makers,” said Merrill Lynch analyst Thomas Besson.
Renault’s first half sales rose 1.9 per cent to 1,374,000, but European market share fell 0.7 percentage points to 10 per cent. Sales in France fell 9.9 per cent and market share slid 3.3 percentage points to 25.2 per cent.
Deutsche Bank is also a supporter, saying that component supply disruption should be progressively sorted out towards the end of July, after costing 50,000 sales in the first half and probably between €150 and €200 million of operating profit. French market share loss should almost entirely be recovered in the second half.
At a press conference following the sales figures announcement, new chief operating officer Carlos Tavares reaffirmed what has seemed a hostage to fortune by many; that by 2020, sales of battery electric vehicles would reach 10 per cent of the global market. Most big manufacturers believe that even five per cent is a target on the high side.
Tavares also hinted at a possible deal with Daimler on electric cars.
“Could we expand it (the cooperation plan with Daimler) to include making electric vehicles? I don’t see why we couldn’t envisage that,” Tavares said, answering a question.
Renault and its alliance partner Nissan of Japan formed a strategic alliance based on the exchange of small equity stakes and promised to work on new technology in general, and the production of a new Smart car to also replace the Twingo, in particular.
Neil Winton – July 20, 2011