Renault is reinventing its entire business, here’s how

Renault, which appears to have been revived under Luca de Meo’s leadership, says it sees myriad rapid changes in the auto industry only as further potential revenue streams or “value chains.”

The Renault Group will split into five focused businesses under one roof, with the goal of becoming a “next-generation automotive company” by 2030 with a revenue opportunity twice that of today.

It might seem a little confusing, but bear with us as we explain. The five Renault Group companies are Power, Alpine, Ampere, Mobilize and The Future Is Neutral, and each will have its own governance and P&L.

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Renault’s internal combustion and hybrid division

The traditional core business of the Renault Group manufactures internal combustion engines (ICE) and hybrid cars under the brand names Renault, Renault Van and Dacia.

ICE and hybrid vehicles will still account for up to 50 percent of global car sales in 2040, Renault says, adding that sales are expected to grow at an average of 2 percent a year between 2022 and 2030.

This wing of the deal accounts for the new 50:50 powertrain joint venture company with Geely, which will supply additional powertrains to the Nissan and Mitsubishi alliance brands, their owners and their brands.

delivered Recognition: car expert
delivered Recognition: car expert

From day one, this company will have sales of more than 15 billion euros and a volume of five million units per year, supplying at least eight related OEMs with common powertrains. It will have 17 factories serving 130 countries, five R&D centers and 3000 engineers.

It will manufacture engines, transmissions, HEV systems and batteries and, through the joint venture, will double both its size and market coverage from 40 percent to 80 percent worldwide.

She also wants to develop technologies in the field of alternative fuels and is looking for cooperation with a “potential partner from the energy industry”.

MORE: Renault and Geely announce ICE and hybrid joint venture companies

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Renault’s Halo EV brand with a focus on performance

The goal is to be the “world’s zero-emission high-end brand with racing pedigree” to capitalize on its A110 coupe and entry into Formula 1.

Alpine now manages a team of 2,000 people, 50 percent of whom are said to be engineers.

Alpine GT X-Over teaser Recognition: car expert
Renault 5 Alpine Concept Recognition: car expert

Alpine’s planned new line-up will be all-electric from 2026. Until then, it plans to sell the next-generation A110 and two other models in the form of a B-segment hatch (a hot version of the 2024 Renault 5 EV) and a small SUV.

The company then plans two larger and “state-of-the-art” cars to support its international expansion, with half of its sales growth expected to come from new markets outside of Europe, including North America and China.

MORE: Alpine adds two larger EVs as it focuses on global expansion

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Renault’s EV wing designed to function more like a startup

In plain language: Ampere will develop, manufacture and sell BEV passenger cars, with software-defined vehicle technology such as over-the-air updates, branded with Renault.

Business language in the Renault presentation says it’s the “first EV and software pure player to emerge from OEM disruption,” which is a fancy way of saying an established brand with a clean sheet.

The plan is for Ampere to “bring the best of both worlds,” meaning the expertise and assets of the Renault Group but the focus and agility of an EV pure player like Tesla.

delivered Recognition: car expert
delivered Recognition: car expert

The company is also seeking outside investors and is considering an IPO on Euronext Paris in the second half of 2023. Renault plans to retain a “strong majority” in Ampere and reportedly expects support from potential investors such as Qualcomm.

Based in France, Ampere will be an OEM with around 10,000 employees, including around 3500 engineers, half of whom are specialized in software.

delivered Recognition: car expert
delivered Recognition: car expert

Before 2030, Ampere’s offering of six Renault-badged EVs will cover 80 percent of the EV mainstream profit pool as it currently is: the B-segment with the new Renault 5 and Renault 4, and the C-segment with Megane E-Tech , the new Scénic and two other electric vehicles yet to be unveiled.

Ampere plans to produce around one million electric vehicles for the Renault brand in 2031, it says.

The Renault Group is building hardware and software partnerships with Qualcomm Technologies (computing platforms based on the Snapdragon Digital Chassis) and Google (Android-based open operating platform with access to third-party app developers).

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Renault’s financial services and car-sharing wing

Mobilize Financial Services already has four million customers and will expand its traditional business while also developing new revenue streams such as subscriptions, insurance and operational leasing.

It will be a vehicle-as-a-service provider with purpose-built vehicles that generate recurring revenue – up to three times the total amount over a vehicle’s lifetime.

“What sets Mobilize apart from any other automotive brand is that it moves from service to product and not the other way around,” claims Renault.

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The future is neutral

The bit focused on recycling the batteries and other things

This entity will provide closed-loop recycling solutions at every stage of a vehicle’s lifecycle: ie delivery of parts and raw materials, production, use and end-of-life.

The aim is to achieve over 90 percent coverage of the value chain by 2030 and to become the European market leader on an industrial scale in the burgeoning circular automotive economy.

It will serve the Renault Group as well as the sector as a whole, opening a minority of its capital to external investors with the aim of co-financing around 500 million euros in investments by 2030.

delivered Recognition: car expert

“Today’s announcements are a fresh sign of the Renault Group team’s determination to prepare the company for the future challenges and opportunities presented by the transformation of our industry,” said Renault CEO Luca de Meo.

“Having executed one of the fastest and most unexpected turnaround plans and preparing the company for growth by ensuring the development of the best product range in decades, we intend to position ourselves faster and stronger than the competition in the new automotive value chains: EV, Software, new mobility and circular economy.

“… Renault Group is a team of teams benefiting from simplified governance and digital management platforms that encourage collaboration and break down silos typical of traditional organizations.”

delivered Recognition: car expert Renault is reinventing its entire business, here’s how

James Brien

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