Newsletter #116 (International)

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Dear colleagues,

This summer has been particularly eventful, with the change of CEO and the announcement of a downward revision of financial targets for this year. We have also all received the shares from the employee shareholding plan issued in May. These topics are covered in this Bulletin, but first, the entire AASR Board wishes you a smooth return after a holiday period that we hope allowed you to recharge your batteries and gather enough energy for the road ahead in the coming months.

Happy reading,

C. Quintard, President of AASR

Luca de Meo’s departure invites us to look in the rearview mirror at the path traveled since his arrival in July 2020, even though it is still too early to assess all of his actions. Let us remember Louis Schweitzer: when he left the company in 2005, some still doubted the relevance of acquiring Dacia… and yet today we can see the immense success of that brand.

We can already credit Luca de Meo with redefining the positioning of each of the Group’s brands: Renault, Dacia, Alpine, Mobilize. Each now has a clear and strong identity, along with a vision for the coming years, and Luca de Meo’s expertise in marketing has fully lived up to expectations. For other, more structural decisions, it will take time before they can be properly evaluated.

Let’s hope he can apply his marketing skills with the same success in the other major French group he has joined, a global luxury leader. This move is all the more relevant given that the luxury industry relies almost entirely on marketing.

In contrast, in the automotive industry, marketing is necessary but not sufficient. Other strong disciplines are essential to design, manufacture, and sell beautiful, reliable, and durable vehicles that customers want to buy. Perhaps, after having “done the marketing job,” it was indeed the right time for him to hand over the reins. The momentum he gave to the Renault Group’s brands is strong enough to continue after his departure. And while the stock price dropped upon the announcement, indicating that investors appreciated him, it does not mean he was indispensable.

Let’s measure some results using the following charts created by AASR to assess long-term trends:

1/ Revenue has seen steady growth since 2021, reaching in 2024 the peak levels previously achieved between 2017 and 2019. More notably, the revenue per vehicle has increased significantly and unprecedentedly: we are selling our vehicles better.

2/ Operating margin has exceeded the previous 2017 record over the past two years: we have moved our vehicles upmarket.

3/ However, net earnings per share remain modest, as fewer vehicles were sold. Consequently, the dividend per share has been cautiously reduced this year.

This mixed short-term assessment will need to be complemented by the future impact of strategic directions initiated during this period : such as the creation of Horse and Ampere.

We should never keep our eyes on the rearview mirror for too long, let’s quickly shift our focus to the challenges and opportunities ahead in a competitive and disrupted world, one that can still offer a prime spot to the most skillful.

Since François Provost’s appointment as CEO, the stock price has been slowly but steadily climbing, even during August, a month not typically favorable for market trend shifts.

Let’s support our new CEO in the months to come, until the next General Shareholders’ Meeting, where we will be able to share our views on the company’s progress.

The announcement of the downward revision of financial targets just days before the release of second-quarter results led to a significant drop in the share price. Yet this clear-eyed adjustment is certainly preferable to unconscious denial.

Similarly, the change in accounting treatment of Renault Group’s stake in Nissan as of June 30, now reflecting the actual market value of Nissan shares instead of their book value, allows the company’s accounts to be realistically cleaned up, even though it requires recording a substantial accounting loss.

Even with the downward revision, the financial outlook remains positive: the projected 6.5% operating margin is on par with the previous record set in 2017.

The gloomy mood in the automotive market overall, compounded by current extreme geopolitical instability and crises that do not directly affect Renault Group (such as the Takata airbag issue), likely contributed to amplify the share price drop following the announcement. We can hope that the stock will return to a level that better reflects the company’s actual situation, provided no further disruptive events occur this fall.

The employee share ownership plan in May was as successful as last year’s, even though the share price was higher and the number of shares offered through matching contributions was lower.

But this success is quite paradoxical. Indeed, being an employee shareholder is not just about passively hoping for financial gain after the five-year lock-up period. It is, above all, a commitment to the Company that should be reflected in active participation in its governance, particularly by voting For or Against the resolutions presented by the Board of Directors at the Annual General Meeting.

44% of employees took part in the share ownership plan, but only 3% voted at this year’s General Meeting, a 15% drop compared to the previous year!

How can we explain this lack of interest from employees in their Company?

AASR sincerely thanks all current and former employees who made the effort to vote, and especially those who gave a proxy to AASR.

AASR received 50% more proxies this year compared to last year, a significant increase, but one we cannot celebrate given the overall decline in voter turnout.

This is merely proof of the effectiveness of AASR’s actions, so please share this Bulletin with all your colleagues so they can subscribe to our mailing list by clicking on “Contact” at the top of this page.

This way, we can hope to reverse the trend in voter participation in 2026.

Do it for yourself, do it for all employee shareholders!

Newsletter distributed by email upon request at aasr@renault.com or by clicking on "Contact" at the top of the page

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Phone : from France : 08 00 00 75 35 / from other countries : +33 (0) 1 49 37 82 36

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