Renault plans to spin off its electric car business via an IPO

  • All the options on the table to separate EV activities
  • 1st quarter turnover 9.75 billion euros against 9.61 billion forecast
  • Shares briefly climb on report Renault could cut Nissan stake

PARIS, April 22 (Reuters) – French carmaker Renault said on Friday all options were on the table to spin off its electric vehicle (EV) business, including a possible second-half IPO 2023.

Thierry Piéton, Renault’s chief financial officer, said any plan was subject to approval by alliance partner Nissan (7201.T), but said the Japanese automaker was “in the know” as Ranault weighs his options .

Renault has continued its plan to split its electric vehicle and combustion engine businesses as it seeks to catch up with rivals such as Tesla (TSLA.O) and Volkswagen (VOWG_p.DE) in the race for cleaner driving.

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Ford (FN) said last month it would run its electric vehicle business separately from its former combustion engine business. Read more

The news came as Renault reported better-than-expected first-quarter sales, with higher prices and higher sales of electric vehicles more than offsetting the impact of war in Ukraine and a continued global shortage of electric vehicles. semiconductors.

Renault shares briefly climbed as high as 5% after Bloomberg reported that Renault may consider reducing its stake in Nissan as part of its plan to separate its EV business.

Renault declined to comment.

Asked about the report, a Nissan spokesman said “we don’t comment on speculation.”

At the start of the afternoon in Paris, the Renault share rose by 1.4%.

The group, which also manufactures Dacia and Lada brand vehicles, said its turnover fell 2.7% from a year earlier to 9.75 billion euros (10 .6 billion dollars). Analysts had expected revenue of around 9.61 billion euros, according to Refinitiv estimates.

Renault’s logo is pictured at a dealership in Vertou, near Nantes, France, January 17, 2022. REUTERS/Stephane Mahe

Excluding Avtovaz and Renault Russia, sales were down 1.1% to €8.9 billion.

Last month, Renault announced it would suspend operations at its Moscow plant while it weighs options on its majority stake in Avtovaz (AVAZI_p.MM), Russia’s top automaker. Read more

On Friday, the French automaker said discussions over the future of Russian operations were “ongoing and progressing”.

The fall in first-quarter revenue follows a 17% drop in vehicle sales to 552,000 vehicles, Renault’s lowest quarterly total since the depths of the global financial crisis in 2009.

The company said sales of all-electric and hybrid vehicles rose 13% and accounted for 36% of the total. Prices rose 5.6% from the first quarter of 2021 as the group continued to sell more profitable cars.

In a client note, JP Morgan analysts described this quarter as a “good quarter”.

“Renault continues to apply its price and model rationalization policy and today’s result is another step in the right direction,” they wrote.

Renault confirmed its financial outlook set in March for an operating margin of around 3% in 2022 and said it would give a detailed update on its targets and strategy later this year.

The global shortage of semiconductors, used in everything from brake sensors to entertainment systems, will cut Renault’s planned car production by 300,000 vehicles in 2022, mostly in the first half, the company said.

Renault’s order book at the end of March reached its highest level in 15 years at 3.9 months of sales.

($1 = 0.9223 euros)

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Reporting by Gilles Guillaume and Nick Carey Writing by Sudip Kar-Gupta Editing by Tomasz Janowski and Mark Potter

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