Automotive News Europe — 2025-07-31
Automotive Industry
Renault’s first-half earnings declined as the automaker appointed company veteran Francois Provost as its chief executive officer following the surprise departure of predecessor Luca de Meo.
Operating margin fell to 6 percent in the six months ended June 30, from 8.1 percent a year earlier, the automaker said in a statement July 31.
Renault earlier this month slashed its profitability outlook, prompting shares to plunge the most since the start of the COVID-19 pandemic.
On July 30, Renault named Provost, its former procurement chief, as CEO to stabilize the automaker.
Renault faces challenges including muted demand in Europe, weakening van sales and the rapid expansion of Chinese automakers led by BYD.
Under de Meo, Renault had focused on lowering the cost of new EVs via partnerships while speeding up development with the help of a China-based engineering team.
“Our first-half results, in a challenging market, were not aligned with our initial ambitions,” Provost said in the statement. “We have already launched a set of countermeasures to deliver our targets. Nevertheless, Renault Group’s profitability remains a reference in our industry, and we are determined to maintain this standard.”
Provost is expected to conduct a review of a strategy de Meo had presented to the board shortly before leaving to take the top job at Gucci owner Kering.
Provost inherits some struggling businesses, including the EV and software unit Ampere that de Meo failed to take public.
He also will have to decide how to shape Renault’s alliance with Nissan after de Meo loosened ties with its longtime Japanese partner and try to retain talent after the departure of award-winning car designer Gilles Vidal, who is joining rival Stellantis.
Renault is now predicting operating margins this year of about 6.5 percent, down from at least 7 percent previously. Citing intensifying competition and declines in the automotive market, the automaker has also adjusted its expectation for free cash flow to as low as €1 billion, from an earlier projection of at least €2 billion.
The group expects second-half performance to improve versus the first-half thanks to elements that include the ramp-up of new car models, such as the electric R4, and “strict” controls on variable and fixed costs.