Renault: its new electric subsidiary “Ampere” coming soon to the stock market

The French automaker Renault presented Tuesday, November 8, a “revolution” that should attract investors, launching its project to put its electric cars on the stock market and sharing the old world of thermal motorization with the Chinese Geely. Its new electric subsidiary called “Ampere” – without an accent – will bring together 10,000 employees in France to produce one million electric vehicles under the Renault brand by 2031, the group said ahead of a day dedicated to investors in Paris. Ampere is targeting annual growth of more than 30% over the next eight years and a margin of 10% in 2030, compared to 4.7% for the Renault group in the first half of 2022.

Ampere will notably produce the new Renault 5 and Renault 4 in northern France. The diamond brand intends to list this subsidiary on the Paris Stock Exchange “at a minimum in the second half of 2023” and thus finance its costly electrical move while maintaining “a strong majority” in Ampere. American electronic chip maker Qualcomm, a supplier to Renault, has already positioned itself as a shareholder in Ampere. Renault, in which the French state and Nissan each own 15%, has yet to specify what stake its Japanese partner will have in its new electric subsidiary. This reorganization heralds a major overhaul of the Renault-Nissan-Mitsubishi alliance, with a reduction in Renault’s stake in Nissan’s capital.

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On the thermal engine side, Renault will share its 50/50 activities with the Chinese group Geely, which already owns Volvo. The two partners will create an equipment supplier called “Horse” (horse) that will develop and produce engines, gearboxes and hybrid systems for thermal (gasoline and diesel) and hybrid cars. This French-Chinese team will have 19,000 employees in Europe (Spain, Romania and Sweden), China and South America, with ten factories and five R&D centers. Its turnover, estimated at more than 15 billion euros, is expected to grow by 4% by 2027.

The group’s finances, however, remain fragile: Renault started to recover from a historic loss due to the Covid-19 pandemic in 2020 before taking another blow with its withdrawal from Dacia in Russia in the spring of 2022. strategic plan, called “Revolution”, Renault aims for an operating margin of over 8% at group level in 2025 and over 10% in 2030. Renault also intends to reinstate a dividend in 2023, when it has not had any dividends since 2019. He also intends to increase employee participation to 10% of the capital by 2030.

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The appreciation of traditional automotive groups, however, is not comparable to that of new entrants specializing in electric cars, such as the American Tesla or the Chinese BYD. American Ford also announced the creation of an electric subsidiary, “Model E”, while German Volkswagen launched its Porsche brand on the stock market to finance its electrification.

keep thermal

A new entity, “Power” (power), will also bring together all of Losange’s thermal and hybrid activities: the subsidiary Horse, therefore, but also the non-electric cars of the Renault brand, those of its economy brand Dacia, which will gradually electrify and targeting a 15% margin by 2030, and utility vehicles.

The sports brand Alpine will also grow as it opens up to investors. Although it currently manufactures only one model, the A110, which has already sold a few thousand copies, will enjoy its new notoriety due to its presence in Formula 1 to seek investors. In addition to the upcoming A110, a small sedan and an SUV, all electric, Alpine also plans to launch a large sedan and a luxury sedan, and expand in particular to North America or China.

The brand points to a growth of 40% per year between 2022 and 2030 and more than 8 billion euros in turnover in 2030. “We are designing an agile and innovative organization to manage the volatility and accelerated technological evolution of our time”, underlined the general manager of the group Luca de Meo. The group also announced the strengthening of its partnership with Google to design a new electronic platform for its vehicles starting in 2026.

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