Renault Driven Into Red Post-Ghosn

Acting Groupe Renault CEO Clotilde Delbos

Acting Groupe Renault CEO Clotilde Delbos. Photo: Groupe Renault Facebook

There was certainly no love between Renault and Nissan on February 14. On Friday, the French carmaker said in a statement it suffered net losses of €141 million.

It’s the first time the company has plummeted into the red since the financial crisis of 2009 when its losses were reported at €3.1 billion.

The car giant said its operating income is down nearly one-third to €2.11 billion, that it intends slash its dividend by more than two-thirds (€1.10 a share). Additionally, in 2019 the group’s operating margin dropped from 6.3% to 4.8% with a further fall in operational profitability expected in 2020.

Renault reported a drop in both sales, down 3.4% to 3.75 million vehicles, and group revenues, down 3.3% to €55.5 billion.

The French automobile manufacturer also saw a decline in financial contribution from its Japanese partner Nissan, dropping from €1.51 billion in 2018 to in at €242 million last year.

“We are going to reassess all our cost types and charges…some of these costs will imply restructuring charges,” said acting Groupe Renault CEO Clotilde Delbos, who will make way for incoming CEO Italian Luca de Meo, from Seat, Volkswagen's Spanish subsidiary. The company did not rule out possible plant closures.

Nissan, of which Renault owns 43%, reported last week that its net profit plummeted nearly 88% following the Carlos Ghosn affair, from April to December.

Nissan CEO Ghosn was arrested in Tokyo in November 2018 over allegations of financial misconduct, including making an unauthorized multimillion-dollar payment to a Nissan dealership in Oman. Released on $14 million bail in April, the Brazilian-born businessman had been awaiting trial and escaped house arrest to flee by private jet to Lebanon last month.