Renault is setting financial targets for its electric vehicle division, Ampere, in preparation for an initial public offering. The French carmaker aims to achieve operating profit parity by 2025, as it positions the EV unit as a "growth story." Renault has set a target for a 30% compound annual growth rate until 2030.
Renault CEO, Luca de Meo, will assume additional roles and become CEO and chairman of the EV division, while other Renault executives will take up senior positions at Ampere.
However, Renault's EV business will face several challenges as de Meo moves to take the company to market. One such challenge is the price cuts introduced in Europe by Tesla, which could lead to lower demand for Renault's newest EV model, the fully electric Megane E-Tech. This model is crucial for Renault's recovery. To compete, Renault is planning to introduce a lower-priced Megane E-Tech version with a smaller battery.
Renault's move to set financial targets for its EV division is a significant step towards preparing Ampere for the public market. Despite the challenges, Renault is confident in its ability to achieve its targets, given its extensive experience in the automotive industry. When Renault's EV division reaches operating profit parity, it will be a major achievement and a positive reflection on the brand. This move could also encourage other carmakers to invest more heavily in EV research and development, further advancing the industry as a whole.