Renault - 2006 commercial results
A year of transition for the Renault Group
International sales continue to rise, performance reduced in Europe*
• 4% drop in worldwide sales a result of contrasting performances depending on market.
- Sales increase by +8.8% outside Europe* thanks to its Renault, Dacia and Samsung brands. Sales outside Europe now represent more than 30% of Group sales in 2006.
- 8.7% drop in European sales, where the selective commercial policy produces its first effects and prepares for the launch of new models.
• Success of Logan: 247,000 cars sold under both the Dacia and Renault brands
• In Europe, Clio sales grow by +26.5% thanks to the success of Clio III.
"2007 will mark a return to growth for Renault from summer onwards. Outside Europe sales will continue to progress and the Renault Group will reinforce its commercial organization to prepare for the arrival of new products. In Europe the first half of the year will remain on a downward trend but the second half, with the arrival of the future Twingo and then the future Laguna, will mark the start of the rebound in sales while retaining the priority given to
profitability. In total, we expect slight growth, essentially in the second half. Patrick Blain, Executive Vice President, Sales & Marketing.
Worldwide sales in 2006 decreased by -4% to 2,433,604 vehicles sold during a year of transition for the Renault Group.
Outside Europe sales increased by +8.8% to 742,019 units thanks to the increasing availability of Logan, the performance of Renault Samsung Motors and the growth of the Renault brand on
international markets. At the end of 2006, sales outside Europe accounted for more than 30% of the Renault Group’s sales. Each of the three brands (Renault, Dacia and Samsung) contributed
to this growth :
- Renault sales rose +9.8% to 471,113 vehicles
- Dacia sales grew by +11.6% to 149,075 vehicles
- Renault Samsung Motors sales grew to a record 121,831 vehicles
*Europe=region France + region Europe
In France and Europe on very competitive markets, a lack of new products and the acceleration of the selective commercial policy to reduce unprofitable sales saw a decrease in sales of -8.7% for the Renault Group to 1,691,585 units, but was accompanied by a noticeable improvement in residual values.
| Euromed Region
In the Euromed region, Renault Group sales grew by +12.6% to 380,084 in 2006, thanks to very strong sales growth for Logan in Russia, and in North Africa where the group ensured its leadership.
Renault grew by +13.8% in the Euromed region. In Russia, on a market that grew by +21.7%, sales leapt by +146.7% and 71,914 vehicles, thanks to the success of Logan in its first full year of sales in this market. The brand also progressed in North Africa by 15.7%. However, sales dropped by -21.2% in Turkey, a market that dropped by -13.2% and was effected by the devaluation of its local currency in 2006. Even so, Renault remains leader of the car market with 16% market share.
Dacia saw its sales increase by +11.1%, thanks to the increasing presence of Logan in Morocco (+369.3%), Algeria (+83.2%) and in Eastern Europe (Ukraine and Bulgaria) where sales have multiplied sevenfold to almost 7,700 units.
| Americas Region
In the Americas region, the Renault Group’s sales increased by +13.2% in 2006 to 186,284 units, notably thanks to strong advances in Colombia, Argentina and Brazil.
In Colombia sales increased by +37.1% mostly thanks to Logan, produced and sold locally under the Renault brand since the end of 2005, securing the number two place in the market for Renault. In Argentina, Renault sales increased ahead of the market by +29.4% to 48,334 vehicles. In Brazil, on a market up by 12.6%, Renault sales increased by +8.5% in 2006 with 51,557 sales, thanks to the launch of the Mégane Sedan and Grandtour models. Notably, 75%
of the cars presently sold by Renault in Brazil run on Flex-Fuel.
Conversely, sales in Mexico dropped to 20,272 units due to the effect of the cycle of renewal of the range. Sales of Kangoo LCV of this market were good, and Clio III will be launched on this market early in 2007.
|Asia-Africa Region
Renault Group sales in the Asia-Africa region dropped slightly (-2.5%) in 2006 to 175,651 vehicles. The slight reduction in sales in this region is principally due to South Africa and the Middle-East
region. The drop of 20% in the value of the South African Rand directed Renault to adapt its commercial policy in South Africa in order to focus on profitability, resulting in a drop in sales of -18.5%.
In South Korea, its first market, Renault Samsung Motors continued its growth and progressed by +3.2%.
| France & Europe Region
The drop in sales in France & Europe is explained by two factors with similar impacts:
- the lack of new products in 2006
- the voluntary reduction of volume linked to the selective commercial policy
These two factors led to reduction in group sales of -8.7% in 2006 to 1,691,585 units, representing a 9.4% market share.
In Europe (including France) the Renault brand, with a 9.1% market share (Car + LCV), sold 1,644,068 vehicles, a drop of 9.8% in the region. Renault remains the leading brand on the European LCV market for the ninth year running with 319,334 vehicles sold representing a 14.1% market share.
The Dacia brand pursued its growth with a sales increase of +54.4% to 47,517 units.
In France the Renault brand remains number one for sales with a 25.5% market share (Car + LCV) selling 649,893 vehicles in 2006. The two best-selling cars in France in 2006 are Clio and Mégane. In addition, Dacia sold 18,794 Logan in France during 2006, and confirms its success with 0.9% market share.
The selective commercial policy
For two years, Renault has pursued a selective commercial policy in Europe. This consists of privileging the most profitable sales channels (retail and fleet customers) and limiting sales to
short term rentals and self registrations, as these vehicles return very quickly to the used car market. This allows Renault to ‘clean’ the stock of used cars in its network and support the residual values of its vehicles.
This policy, while penalizing volumes in the short term, allows Renault to prepare for the future and will pay off in the medium term both in volumes and profitability. In the case of Clio III its
residual value has already risen by 6% (Eurotax estimate).
| Outlook
2007 will see the beginning of a return to growth for the Renault Group from the summertime onwards. Outside Europe sales growth will again be stronger thanks notably to the group’s operations in
India, the Mercosur and in Iran, with the start of production and sales of Logan. Renault will also reinforce its commercial organisation in a number of countries in preparation for the arrival of new products which will be launched under Renault Commitment 2009. Renault Samsung Motors will launch a 4x4 model on to the South Korean market at the end of 2007.
In Europe, 2007 will be a year of contrasts for Renault. The first half of the year will see continuity with 2006 with priority given to profitability. During the second half of 2007, the launches of the future Twingo and then the future Laguna, will allow sales to renew
progressively with growth, with the full impact of these launches the following year.
Globally, the Renault Group’s worldwide sales should experience a slight increase in 2007, this growth exclusively concentrated in the second half, which marks the beginning of the Renault Commitment 2009 product offensive.
ANNEXE 1
Renault Group sales at the end of December 2006
Provisional figures
Total sales by brand of the Renault Group
Cumulative 2006 2005 % var
RENAULT Cars 1,737,043 1,878,434 -7.5
LCV 378,138 372,378 +1.5
Total Renault 2,115,181 2,250,812 -6.0
RSM Cars 121,831 119,488 +2.0
Total RSM(*) 121,831 119,488 +2.0
DACIA Cars 184,751 143,621 +28.6
LCV 11,841 20,743 -42.9
Total Dacia(*) 196,592 164,364 +19.6
RENAULT Group Cars 2,043,625 2,141,543 -4.6
LCV 389,979 393,121 -0.8
Total Group 2,433,604 2,534,664 -4.0
(*) Sales on local market + exports
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