As fuel prices soar, Renault (RNLSY.US) is accelerating electrification: 16 pure electric models will be launched in Europe before 2030.

Amidst a significant increase in fuel prices, French car manufacturer Renault Group (RNLSY.US) is accelerating the electrification of its product lineup, with plans to focus on launching predominantly electric vehicles in the future. Renault announced on an investor day on Tuesday that by 2030, the company plans to introduce 22 new models in the European market, with 16 of them being pure electric vehicles. Additionally, Renault will also launch 14 new models in markets outside of Europe to seek stronger growth. This move by Renault comes at a time when the market is facing a complex situation: on one hand, the situation in Iran is disrupting oil supply and international gasoline prices continue to rise; but at the same time, influenced by weak market demand, several automakers including Stellantis (STLA.US) and Volvo (VLVLY.US) have already adjusted their electric car development goals. Furthermore, faced with increasing competition pressure from Chinese competitors such as Stellantis and BYD Company Limited (01211), Renault CEO Francois Provost is under immense pressure to increase sales. Since the beginning of this year, Renault's stock price has fallen by about 20%. As a car manufacturer with Europe as its core market, Renault is hopeful that the European electric vehicle market will regain momentum. With countries like Germany restarting electric car subsidy policies, sales of plug-in hybrid vehicles in Europe continue to rise: in January, electric vehicle registrations in Europe were up 14% year-on-year, and plug-in hybrid vehicle sales increased by nearly 30%. As a senior executive at Renault and former Group Chief Procurement Officer, Provost, who took over the CEO position after Luca de Meo suddenly left, has been implementing cost-cutting measures to help stabilize the company's operations. Provost has been trying to show investors that Renault must learn from the efficiency and agility of its Chinese competitors. Currently, Renault has partnered with Geely Group (00175) to accelerate the development of models in markets like Korea and Brazil, and reduce costs. On Tuesday, Renault reiterated its mid-term performance targets: maintaining a group operating margin between 5% and 7% of revenue, generating annual average free cash flow of at least 1.5 billion euros from its automotive business, and aiming to reduce variable costs per vehicle by about 400 euros per year. Renault also stated that it will continue to use hybrid technology after 2030. The company plans to further streamline components - reducing the average number of components per vehicle by 30%, and deploying 350 Siasun Robot & Automation robots to handle heavy and low-value-added tasks to continue to control costs. Furthermore, Renault plans to further expand its market share in Latin America and India, while consolidating its position in Europe and enhancing its market competitiveness leveraging its own platform. Provost stated in a statement: "To become a benchmark European car manufacturer, we must be determined to design and manufacture products in Europe that are first-class in attractiveness, technological strength, and competitiveness."