Renault’s Q1 Sales Boosted by Financing Arm, Affirms 2024 Profit Forecast

French automaker Renault reported a 1.8% increase in first-quarter revenue, driven by strong sales at its financing arm and cost-cutting measures. The company reiterated its profit margin and cash flow forecast for 2024, despite challenges in the global auto sector.

Renault is undergoing a turnaround plan while focusing on the shift to electric models. The company is set to launch seven new models this year, including two fully electric and two hybrids. Renault’s Chief Financial Officer, Thierry Pieton, stated that the automaker is on track to reduce its EV costs by 40% by 2027.

Although sales volumes have returned to growth, prices are under pressure due to weak global demand. Competition from companies like Tesla, who recently slashed prices on their Model 3, adds to the challenges faced by European automakers.

Renault’s first-quarter revenue reached 11.7 billion euros, surpassing analyst estimates. However, automotive revenue dipped by 0.7% due to foreign exchange rates in certain markets. Sales volumes increased by 2.6%, but revenue in the core automotive business declined as independent dealers destocked more than in the previous year.

Despite these challenges, Renault remains focused on achieving an operating margin of at least 7.5% and free cash flow of 2.5 billion euros by 2024. The company’s commitment to cost-cutting and innovation in electric vehicles positions it well for the future amidst a competitive and evolving auto industry.