Renault will drop the Ampere listing if the rating is too low

Renault SA will not launch the initial public offering (IPO) of its electric vehicle division Ampere, planned for next year, if its valuation is too low, the French carmaker's chief executive Luca de Meo said yesterday, according to Reuters.

"We're not crazy," de Meo told reporters ahead of an investor presentation aimed at drumming up support for the IPO.

At the meeting, the Renault boss urged European investors to back its new electric vehicle division, Ampere. Luca de Meo said the French carmaker has "many options", including funding its electric vehicle offensive.

The Renault official insisted, according to the Financial Times: "My task is to defend the European industry and make sure that it will be globally competitive. If you don't like it, go to China or the US."

Luca de Meo added that the Ampere business hopes to attract a new class of investors, being a "green" company. He pointed out: "Perhaps many people who would never invest in a traditional car manufacturer would be interested in the Ampere project."

Ampere's listing is a key component of Luca de Meo's strategy to relaunch carmaker Renault, with the company official betting on a valuation of between 8 billion and 10 billion euros for the electric vehicle division's IPO. The offering has already been delayed once due to unfavorable market conditions, and is now scheduled to take place in the spring of 2024.

But slowing demand for electric cars, stock market turmoil and increasingly fierce competition from Chinese automakers could complicate Luca de Meo's plans, especially since, according to sources cited by Reuters, the valuation considered by the head of Renault is too ambitious. According to the sources, it is possible that Renault will abandon the IPO if the obtained valuation will be lower than 6-7 billion.

Analysts at the Swiss bank UBS Group AG valued Ampere at only 3-4 billion euros.

Ampere has 11,000 employees, 35% of whom are engineers who design, develop and produce Renault vehicles in France.

• Renault launched the Legend, a new electric vehicle with a price below 20,000 euros

Yesterday, Renault announced the launch of Legend, its new electric vehicle that has a price of less than 20,000 euros, in the context of Chinese and American competition, according to AFP.

Made in Europe, the Legend is intended to be a compact urban vehicle, planned to hit the market in 2025. The Legend is expected to consume only 10 kWh/100km, CO2 emissions over the life cycle 75% lower than the majority of internal combustion vehicles sold on the European market in 2023 and a reduced consumption of raw materials, thanks to its compact dimensions.

The Ampere division will offer a total of seven electric models by 2031: Megane E-Tech, Scenic E-Tech, Renault 5, Renault 4, Legend and two additional vehicles. Ampere plans to sell 300,000 vehicles in 2025, a goal that will increase to one million units in 2031. At the same time, Ampere wants to achieve a turnover of 10 billion euros in 2025, compared to 46 billion euros, as much as the entire Renault group achieved in 2022. Ampere's expected turnover for 2031 is 25 billion euros, based on a compound annual growth rate of over 30% between 2023 and 2031.

Renault's chief financial officer, Thierry Pieton, said that

the car manufacturer is aiming to make electric vehicles more and more accessible in Europe, so that production costs will be reduced significantly, with a view to lowering sales prices.