French car maker Renault is on the hunt for new partners to buy its cars and components as it reported a fall in quarterly revenue and pushed ahead on a strategic review with “nothing off the table.”
The review is expected to be completed within a few months and investors are hoping that will allow Renault to turn a page on months of uncertainty after the arrest last year of Renault-Nissan alliance boss Carlos Ghosn.
All aspects of the business – including Renault’s long-time, high-profile participation in Formula One motor racing – are being examined, interim CEO Clotilde Delbos told analysts.
Group revenue fell 1.6 per cent to 11.3 billion euros in the third quarter, weighed down by a drop in production at partners Nissan and Daimler and declining demand for diesel engines which compounded the effects of a slowing global market.
Sales by volume in the quarter were down 4.4 per cent.
Shares in Renault, which owns 43.4 per cent of Japanese manufacturer Nissan, were largely unchanged after publication of the company’s quarterly results.
Investors had already digested the news about weaker revenue since the company issued a profit warning last week, which Ms. Delbos said was partly due to a decline in sales to partners.
Besides selling Renault-branded vehicles, the company also uses its plants to manufacture vehicles for its partner, Nissan, and for Daimler, and it is a specialist in making diesel engines for other automakers.
Sales of the vehicles it makes for partners have slowed, with a knock-on effect on Renault’s revenues, while demand for diesel engines in Europe has declined.
Renault said those effects were compounded by the closure of the Iranian market since last year as a result of U.S. trade sanctions.
Renault has been trying to regain momentum after Mr. Ghosn’s arrest in November, 2018, in Japan, on financial misconduct charges that he denies.
Earlier this month, Nissan appointed a new chief executive and days later Renault CEO Thierry Bollore – who had been appointed under Mr. Ghosn – was pushed out, to be replaced on an interim basis by Ms. Delbos, who is Renault finance director.
On the call with analysts, she said there was little prospect of sales to partners rebounding in the near future, so the company would look for new partners to sell cars and components to. She did not give details on what kind of savings Renault was seeking with Nissan.
She said the company hoped to conclude within a few months a review of its Drive the Future strategy – a plan that was launched in 2017 by Mr. Ghosn and which now is set to be changed as part of the alliance’s effort to put the Ghosn era behind it.
F1 motor racing, a pet project of Mr. Ghosn’s that costs Renault million of dollars to fund each year, is among everything being looked at, though it is not being targeted, she said.
“Everything can be on the table at some point,” Ms. Delbos said.
“It is too early to mention the routes we are working on, we need to refine, we have quite a few ideas already that have been put on paper, before we can announce everything, I guess in a few months,” she said.
Also on Friday, Renault revised downwards its forecasts for the growth of the global auto market, saying it expected a year-on-year decline in 2019 of around 4 per cent, compared to its previous forecast of about 3 per cent.