Renault registered a record loss of over 7 billion euros in the first half of 2020. The diamond-shaped brand has been plumbed by the coronavirus and by Nissan.

Renault has just announced the heaviest net loss in its history. In the first half of 2020, the group lost 7.3 billion euros! The previous record was a loss of 3.1 billion euros… for the entire year 2009. Being already struggling, the diamond-shaped brand was devastated by the coronavirus Covid-19 pandemic, which sharply slowed sales.

Amid a 28.3% decline in the global market, Renault and its subsidiaries saw their sales fall by 34.9% to 1.26 million vehicles. Thus, revenues followed the same trend, plunging 34.3% to 18.4 billion euros. A significant drop in sales to partners also had a negative impact of 2 billion euros, especially with the discontinuation of the partnership with Opel on medium commercial vehicles. Renault points to an improvement in the price and product mix effect, thanks to the renewal of the Clio and Captur models, whose average selling price has risen.

The group recorded a negative operating margin of -1.2 billion euros (-6.5% of revenues). Renault reports that the negative impact of Covid-19 is estimated at around €1.8 billion for the first half. However, the pandemic is not the only problem for the French manufacturer. Results are once again being pulled down by Nissan, in which Renault has a 43% stake and which too recorded colossal losses. The net loss of 7.39 billion euros was heavily penalised by the negative contribution of the Japanese, amounting to 4.82 billion euros. The situation is not expected to improve anytime soon, as Nissan is already expecting poor balance sheets until 2021.

Renault is trying to be optimistic, pointing out a high level of orders. The brand will also implement its vast savings plan presented at the end of May. It has already set itself the target of reducing its fixed costs by 600 million euros this year.

Luca de Meo, Renault’s new Chief Executive Officer, said: “The situation is unprecedented and not without consequences. Together with all the group’s management teams and employees, we are determined to rectify our path with a firm discipline that will go beyond reducing our fixed costs. Preparing for the future also means building our development strategy, and we are actively working on this. I have every confidence in the Group’s ability to bounce back.”