Renault's 2024 Profit Surge: A Tale of New Launches and Electrification

Renault Group's 2024 financial results have been nothing short of impressive, with the company reporting a record operating profit and cash generation. The Group's revenue increased by 7.4% to €56.2 billion, driven by the complementary auto brands, all of which delivered growth. This robust performance was supported by a solid free cash flow of €2.9 billion, driven by a strong operational performance. Renault Group's operating profit in absolute value reached €4.3 billion, an increase of €146 million compared to 2023, with an operating margin of 7.6% of revenue. The Group's net income – Group share – was €2.8 billion, a 21% increase compared to 2023, excluding a total of -€2.0 billion of Nissan's impacts related to capital loss on Nissan's shares disposals, Nissan's contribution and partial impairment of investment in Nissan.

Renault Group's success in 2024 can be attributed to several strategic moves and initiatives:

1. Product offensive and line-up renewal: Renault Group launched 10 new models and 2 facelifts in 2024, and plans to launch 7 new models and 2 facelifts in 2025. This offensive has helped the company to drive sales growth and improve its product mix. For instance, Renault brand's sales to retail customers in Europe represented 63% of the Group's sales, a 21-point increase compared to the market average.
2. Electrification offensive: Renault Group continued its electrification offensive, with a mix of electrified sales at 33% in Europe, a 4.1-point increase compared to 2023. The Group's electrified sales mix in Europe reached 49% for Renault brand, with a 49% hybrid mix and a 9% EV mix. Renault brand was ranked #2 in hybrid (HEV) in Europe and EV sales at 13%.
3. Cost reduction and pricing actions: Renault Group has been working on reducing its costs and passing part of those gains to its customers, allowing the Group to boost its competitiveness while protecting margins. The Group's strategy is to work on the combination of cost reduction and pricing actions, with the sole objective of improving margins.
4. Improved residual values: Renault Group has seen an increase in residual values for both Renault and Dacia brands. Renault's residual values increased by 9.1 points, and Dacia's by 9.5 points in 4 years, outperforming the market in 2024.
5. Optimized inventory management: Renault Group has maintained a healthy level of inventories, with total inventories of new vehicles at a very healthy level of 500,000 vehicles at the end of June 2024, down 69k units year-on-year.
6. Rigorous financial discipline: Renault Group has maintained rigorous financial discipline, supporting strategic investments and driving efficiency across all operations. This has empowered the Group to innovate, grow sustainably, and deliver long-term value to its stakeholders.

Renault Group's 2024 financial performance demonstrates the success of its strategic moves and initiatives. The Group's record profitability and cash generation, combined with its strong product offensive and electrification offensive, position it well for continued growth and success in the future. As Renault Group looks ahead to 2025, it aims to achieve a Group operating margin of at least 7% and a free cash flow of at least €2 billion, including a €150 million dividend from Mobilize Financial Services.