William Malcolm

Renault Cuts Production Outlook By 500,000 Cars Due To Chip Shortage

French carmaker Renault estimates that due to the global shortage of chips, it will produce half a million less cars this year. This is a larger decline than previously estimated. In the company’s third quarter, sales fell 22.3 percent to 599,027 vehicles. Today, however, the carmaker left the profit outlook for this year unchanged, as it sells cars at higher prices, while its costs have fallen.

In July, Renault expected to produce 200,000 fewer vehicles than planned this year. In the third quarter alone, the outage was 170,000 cars, the company said.

At the same time, Renault has no problems with orders. At the end of September, the order books were as full as they were last 15 years ago.

Sales from July to September decreased by 13.4 percent to nine billion euros (almost 231 billion CZK). Higher sales prices prevented a larger loss.

Under the new boss, Luca de Meo, Renault has decided to focus less on quantity and instead, like other carmakers, has focused on returns. The group also maintained its forecast for this year’s operating margin – it should be at the level of the first six months, when it was 2.8 percent.

Fully electric, plug-in hybrid and hybrid models accounted for more than 31 percent of sales in the third quarter, Renault said. De Meo announced in late June that the company intends to invest ten billion euros in the electrification of its cars over the next five years. According to him, the carmaker assumes that cars with fully electric drive will make up 90 percent of its models by 2030.