Wednesday, 16 October, 2019

Renault hit by Iran withdrawal as quarterly sales drop 5 per cent

Renault reported a decline in revenue and unit sales in the first quarter after withdrawing from Iran, weakness in some emerging markets and currency fluctuations. Revenues at the French carmaker fell 4.8 per cent to €12.5bn, while the number of cars sold dropped by 5.6 per cent to 908,000. Once currency moves were stripped out, revenues fell by 2.7 per cent.

Revenues at the French carmaker fell 4.8 per cent to €12.5bn, while the number of cars sold dropped by 5.6 per cent to 908,000. Once currency moves were stripped out, revenues fell by 2.7 per cent.

The group does not disclose profits when reporting first-quarter results but the company on Friday reaffirmed its guidance for the year to reach a 6 per cent margin, increase revenues at constant exchange rates and generate positive cash. The report comes days after Renault’s alliance partner Nissan downgraded its profit expectations for the second time this year after weak performance in the US and China.

The report comes days after Renault’s alliance partner Nissan downgraded its profit expectations for the second time this year after weak performance in the US and China.

Renault’s sales were hit by the collapse of markets in Argentina and Turkey, which both dropped by near-50 per cent, as well as its decision to withdraw from Iran last year to avoid US sanctions.

Sales rose 2 per cent in Europe, and were flat in Russia.

Car sales are dropping worldwide as the cycle of car buyers turns in the major strongholds of China, the US and Europe.

Renault is not exposed to the US, and has very limited operations in China, but is heavily reliant on Europe and exposed to emerging markets such as Brazil, Argentina, India and Russia, which is its largest market after France.

Via: FT

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