(Reuters) – Renault (RENA.PA), opens new tab on Wednesday reported a 9% increase in annual global sales volumes for 2023, returning to growth after four consecutive years of decline and the French automaker said it was poised to continue performing well in 2024.
In morning trading, Renault shares were down 1.9%, alongside other European automakers whose shares were hit after Tesla (TSLA.O), opens new tab slashed prices of its Model Y electric cars in Germany.
Renault had seen its volumes drop nearly 6% in 2022, a year plagued by semiconductor chip shortages, after setting a sales record of 3.88 million vehicles – cars and vans – in 2018.
Renault’s sales slump was exacerbated by its exit from the Russian market.
To boost sales, Renault shrank its vehicle range and refocused under CEO Luca de Meo on its most profitable markets and models.
“We are regaining our attractiveness (…) our design is improving, and we also see this in our conquest rates,” Fabrice Cambolive, Renault brand general manager told reporters. “The plan is to continue at this same level of performance” in 2024.
The return to growth shows that de Meo’s plans have begun to pay off. While the group performance was below the 12% growth posted by Volkswagen (VOWG_p.DE), opens new tab, Renault said that its sales in Europe rose 18.6%, above the industry’s 13.9% growth for the year.
Europe accounted for 63% of the sales in 2023, but the automaker plans to grow outside Europe with eight new global model launches by 2027.
In a client note, ODDO BHF analyst Michael Foundoukidis described Renault’s 2023 sales performance as “relatively robust,” saying that the carmaker should be able to outperform the market in 2024 “thanks to the numerous (model) launches planned this year.”
Its flagship Renault brand, which accounts for more than two-thirds of group sales, recorded a 9.4% sales increase in 2023, while sales at its low-cost brand Dacia grew 14.7%.
The group’s order book in Europe represents 2-1/2 months of forecast sales at the end of December 2023, Renault added.
Electrified models represented 40% of Renault brand sales in 2023, up from 38% in 2022. Fully-electric models made up 11% of sales.
Asked about supply disruptions caused by attacks in the Red Sea, Cambolive said “we have visibility over the next eight weeks.
“After that we don’t know what could happen,” he added.
Reporting by Gilles Guillaume and Diana Mandiá, writing by Nick Carey; Editin
