(Reuters) - PARIS, Nov 8 (Reuters) - Renault (RENA.PA), the French automaker, has unveiled a massive restructuring that would see it break its activities into five divisions, strengthen connections with China's Geely, and spin off its electric cars subsidiary through a public market offering next year.
Renault said in a long-awaited investor presentation on Tuesday that it aimed for operating margins of 8% in 2025, rising to well over 10% in 2030, up from 5% this year.It also intends to resume dividend payments in 2023 after a three-year break, and to produce more than 2 billion euros in cash annually between 2023 and 2025, increasing to more than 3 billion euros over the next five years.Renault, an early adopter of electric vehicles, has slipped behind younger, more nimble competitors such as Tesla. Following the need for emergency funding during the COVID epidemic, the group is hoping to continue its turnaround following losses in 2019 and 2020, as well as improve the valuation of its various segments.However, huge questions remain about its fragile relationship with long-term Japanese partner Nissan, as Renault seeks new outside investors for each of its businesses.
The carmaker's major aim is to separate its combustion engine business - which will partner with Geely in a 50-50 joint venture, also announced on Tuesday - from its electric vehicle section, which will be listed in the second half of next year.According to Reuters, talks with Nissan have stalled due to Japanese misgivings about sharing technology with others, especially a Chinese rival like Geely.
Renault shares plummeted 2% around 1254 GMT, after falling more than 4% earlier, as the company provided scant insight on the status of talks with Nissan on the future of their alliance.
Renault CEO Luca De Meo stated that the firm intended to give the alliance a "fresh opportunity." But, like in any marriage, he added, "it is necessary for us to have our own hobbies and our own lives."
The firms had set a Nov. 15 deadline for a deal, but no news is currently expected on that date.according to persons familiar with the discussions
Renault will have three companies in addition to the Ampere EV unit and the combustion engine division: the Alpine sports-car brand, financial services, and innovative mobility and recycling operations.
"We are developing autonomous firms that are focused on fundamentally more lucrative operations, are open to external investment, and are based around an indigenous set of technology," De Meo told investors.
He compared the "old" Renault to a pentathlon athlete who would struggle to win gold medals in all five sport specialisations, using a sports metaphor.
"Renault aspires to win gold in those diverse sports instead of remaining at an average level in all five," he stated, by collaborating in each of its new five companies with the finest possible partners.according to persons familiar with the discussions
Renault will have three companies in addition to the Ampere EV unit and the combustion engine division: the Alpine sports-car brand, financial services, and innovative mobility and recycling operations.
"We are developing autonomous firms that are focused on fundamentally more lucrative operations, are open to external investment, and are based around an indigenous set of technology," De Meo told investors.
He compared the "old" Renault to a pentathlon athlete who would struggle to win gold medals in all five sport specialisations, using a sports metaphor.
"Renault aspires to win gold in those diverse sports instead of remaining at an average level in all five," he stated, by collaborating in each of its new five companies with the finest possible partners.
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