Luca De Meo Says EVs Will Help Rescue Renault From Hell

What some companies view as a hindrance, Renault’s CEO sees as an asset.

Some car companies bet on discrediting EVs to try to extract more money from their investments in combustion engines for as long as they can. Some others do not go that far but are also willing to make the most of what they have instead of developing EVs, as the Mercedes-Benz EQA shows. Ironically, Renault’s EV efforts are what will help Luca de Meo bring it back “from hell,” as he told the FT (Financial Times).

According to Renault’s CEO, when he checked the company’s electric car platform, he saw it “has nothing to envy” in VW’s MEB. Although the FT article does not mention which architecture De Meo is talking about, we believe it is the CMF-EV presented in the video above.

This platform also relies on modularity – which allows it to fit multiple sizes and car bodies – and it is probably the one that will be used to bring the Renault 5 back to life as an electric car. The first vehicle to present it will be the Nissan Ariya, which brings us to the Alliance Carlos Ghosn tried to turn into a merger before he was arrested.

The Renaulution strategic plan does not mention the Alliance at any point, which could imply Renault does not rely on its partners anymore. The CMF-EV proves that is not the case. Among De Meo’s plans is spending some time with Nissan and Mitsubishi to “eat sushi together, drink sake,” and heal the relationship with the Japanese companies. 

This is a must for all companies involved. They are so tied up together that they have to at least carry on with their current plans, such as the common platforms. If they eventually decide to part ways, they will have to do it slowly and at a safe pace for everyone.

Apart from the good platform for its plans for the Renault Group, De Meo is also happy that the companies’ current EVs “already make as much profit as their petrol equivalents.” Either that means they are profitable or that they lose as much money as vehicles with combustion engines for Renault, which is very unlikely.

One of the main arguments against electric cars is that automakers would not survive by selling them. In Renault’s case, De Meo believes hybrid and plug-in hybrid cars will be more profitable than ICE vehicles in 18 months. By the middle of the decade, he wants 70 percent of the group’s sales to be electric or hybrid. Renault will sell its last combustion-engined vehicle by 2035 or even sooner, by 2030. Volkswagen plans to do that by 2040.

To FT, De Meo confessed French plants drag down the company’s profit margins due to “suboptimal utilization” of Renault’s production capacity. His answer for that is turning the operations there into something else, such as the Refactory in Flins.

Renault’s plans to deal with energy and software may also help put its workers in activities other than car manufacturing. As De Meo said, he does not want to be the guy that fired 50,000 people in the company’s home country.

In an environment where some insist that electric mobility will break the automotive business, Renault’s CEO thanks it for offering the company a path to salvation. If he is successful, he’ll prove Leon C. Megginson right in paraphrasing Charles Darwin: it is not the strongest that survives; it is the most adaptable to change.

Source:FT (Financial Times)

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