Gilles Guillaume
PARIS (Reuters) – Renault Chief Executive Luca de Meo says a bet on low-cost gearbox technology will help the French carmaker position itself in Europe’s fast-growing hybrid car market. It has been able to establish itself, giving it some leeway as its rivals are squeezed by the challenges of electric mobility.
Despite the European Union’s ban on internal combustion engine cars due to take effect in 2035, demand for expensive electric cars has not increased in Europe, putting a huge strain on the European car industry.
But Renault, which is smaller than its car peers and suffered record losses in 2020, has shown surprising strength in hybrid cars, which use both heat and electric engines.
Sales of Renault’s hybrid models, including the Clio and Captur, rose 55% year-on-year in the first eight months of this year, outpacing the 21.1% rise in the European Union as a whole, European data showed. Industry organization ACEA show.
Sales growth in the first half of this year reached 60%, making the Renault brand second in Europe after Japan’s Toyota in this segment.
“Renault’s performance appears to be very strong” after Renault announced on October 8 that it would stick to its business targets, Stifel analysts said, adding that they would not lower their earnings forecasts despite the difficult market environment. It became one of the few traditional car manufacturers.
“We believe we are simply more versatile and agile than our peers,” they added in a research note.
By maintaining the strengths of hybrid cars, which are cheaper than electric cars and less polluting than conventional cars, DeMeo could reduce the group’s overall emissions and boost sales in the short term.
Demand for hybrid vehicles is expected to continue increasing until the end of this year, before electric vehicles become more widespread, according to consultancies Dataforce and S&P Global.
Renault has a market capitalization of 11.6 billion euros ($12.68 billion), only a quarter of that of European leader Volkswagen, and although it is highly agile, it is struggling with increasing competition from Chinese electric vehicles. May become more vulnerable.
The company, which is 15% owned by the French state, is seeking a new direction after largely abandoning its 20-year partnership with Nissan Motor Co. and Mitsubishi Motors Corp. and also abandoning a planned IPO for its EV unit Ampere.
low cost gearbox
The secret to Renault’s recent success in the hybrid field is its focus on the technologies mastered by the French group.
Engineers at Renault, a century-old gearbox pioneer, have developed a low-cost hybrid transmission system dubbed E-Tech that connects and disconnects gears without the need for a synchronizer battery. We focused on the simplified “dog clutch” used to
Gearboxes use synchronizers and gears to manage the speed of the engine and transmission to the wheels.
The E-tech system can be used on all Renault models and requires fewer components, making it lighter and cheaper than other dual engines.
Investors seem satisfied. Renault shares are up 6.4% since the start of the year, while the European Auto Stock Index is down 12%.
“Renault has a particularly easy time balancing battery electric vehicles and hybrid transmissions compared to its competitors,” said Philippe Houchois, an analyst at Jefferies.
Analysts expect growth to continue as Renault launches more new models at affordable prices. Renault’s hybrid Clio costs 400 euros more than the Toyota Yaris or Peugeot 208, but is more powerful, and its E-Tech gearbox system is used not only in small cars but also in the new 300 horsepower Rafale coupe sedan. can.
“Renault will maintain this advantage for several years,” said Antoine Giraud, an analyst at S&P Global.
Stagnant EVS
Benjamin Kibbies, senior automotive analyst at a Germany-based consultancy, said Renault could sell fewer electric cars than its competitors due to the strength of hybrid cars, which have a lower environmental impact than regular cars. Regardless, he said it would help comply with EU rules limiting CO2 emissions regulations. data force.
Renault’s E-Tech hybrid cars emit just 95 grams per kilometer, enabling the group to achieve an average carbon dioxide emissions of 114 grams for the first half of 2024, Dataforce said.
That’s better than Ford and Volkswagen’s average carbon emissions of 123 grams and 125 grams, respectively.
However, Renault’s surprising strength in hybrids may still have its limits. Starting next year, European car manufacturers will have to cut their average CO2 emissions to 94 grams per kilometer.
To comply with those limits, Renault would need to derive just under 20% of its revenue from electric vehicles, said a person familiar with the matter, who requested anonymity due to confidentiality issues. This is difficult as Renault’s EV sales account for only about 12% of its brand sales in Europe.
A pioneer in electric vehicles over the past decade, Renault has been overtaken by pure-play companies like Tesla and larger competitors like Stellantis.
DeMeo is set to unveil a new electric SUV, the Renault 4, at the Paris Auto Show starting October 14, following the recent launch of another small EV, the Renault 5.
“Selling more hybrid cars instead of thermal-powered cars is the only way to go in the right direction. But the key is also the successful launch of both R5 and R4,” Giraud said.
(1 dollar = 0.9145 euro)
(Reporting by Gilles Guillaume; Writing by Dominique Patton; Editing by Lisa Jucca)
