Renault Q1 sales dented by Ukraine conflict, semiconductor crisis

RENAULT, the Western carmaker most exposed to the Russian market, posted lower first-quarter revenues due to the war in Ukraine and a semiconductor shortage, partially offset by higher prices and rising electric vehicle (EV) sales.

The group, which also produces Dacia and Lada brand vehicles, said on Friday its revenue fell by 2.7 per cent from a year earlier to 9.748 billion euros (S$14.4 billion). Excluding the activities of Avtovaz and Renault Russia, it stood at 8.9 billion euros, down by 1.1 per cent.

The drop in revenue came as the French car maker’s sales fell more than 17 per cent versus the first quarter of 2021 to 552,000 vehicles, the lowest quarterly sales since during the height of the global financial crisis in 2009.

The company said its sales of fully-electric and hybrid vehicles were up 13 per cent and accounted for 36 per cent of sales.

The global semiconductor crisis will cut the company’s planed car production by 300,000 vehicles in 2022, most of those in the first half of the year, Renault said.

The company’s order book at the end of March had hit a 15-year high of 3.9 months of sales.

Renault has been pushing ahead with plans to split its EV and combustion businesses, as it catches up to rivals such as Tesla and Volkswagen and reviews its business in Russia amid wide-ranging Western sanctions.

Renault confirmed its financial outlook laid out in March of a full-year 2022 operating margin of around 3 per cent and said it would give a more detailed update on its targets and strategy later this year.

“In a market environment severely disrupted by the conflict in Ukraine, the semiconductor crisis and inflation, Renault Group is continuing its recovery and accelerating the implementation of its strategy,” Thierry Piéton, Renault’s finance chief, said in a statement.

Last month, Renault said it would suspend operations at its plant in Moscow while it assesses options on its majority stake in Avtovaz, the country’s No 1 carmaker. BLOOMBERG