Renault Commitment 2009
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12th February, 2006
On Thursday 9th February, 2006, Renault's President and Chief Executive Officer Carlos Ghosn announced "Renault Commitment 2009," a growth plan whose ambition is to make and sustain Renault as the most profitable European volume car company.
Renault makes three major commitments:
- Position the next Laguna, which will be launched in 2007, among the top
three models in its segment in terms of product and service quality;
"A new, exciting page in the history of Renault is being written, based on the motivation and dedication of the women and men of our company," said Mr. Ghosn.
An unprecedented product offensive
Renault will launch 26 new products better focused on the needs and aspirations of its customers. The strength of the product plan will lead to an unprecedented acceleration of new vehicle launches: in addition to the two launched in 2006, Renault will launch an average of eight models each year from 2007 to 2009, which is double the number launched from 1998 to 2005. Half of these cars will expand the lineup.
The product offensive will
result in widening the lineup in four directions:
Renault’s sales outside Europe are expected to grow from 27% of total sales in 2005 to 37% in 2009, an increase of 80%.
The average age of Renault products sold in Europe will drop from 3.8 years in 2005 to 2.2 years in 2009.
The enrichment of Renault’s offer is expected to increase sales by an additional 800,000 units in 2009 compared to 2005.
Quality and technology commitments
The next Laguna, to be launched in 2007, will be among the top three in its segment in product and service quality. The progress made on this product will be applied with the same diligence to the rest of the lineup throughout the world.
In terms of fuel economy and CO2 emissions reduction, the Renault lineup is among the most efficient in the world today. The company’s objective is further improvement. By 2008, Renault will sell one million cars emitting less than 140 grams of CO2 per kilometre, of which one-third will emit less than 120 grammes.
In addition, 50% of petrol-powered engines for sale in Europe in 2009 will have the ability to operate with a mixture of gasoline and ethanol. By the same date, all diesel engines will be able to operate with 30% diester2.
Within the Alliance (the Renault/Nisan Alliance), Renault is preparing a full range of alternative technologies, such as hybrids, fuel cells and electric vehicles. In France by the end of the plan, Renault will test fuel cell vehicles equipped with the latest Alliance technologies.
As the current European safety leader, Renault will continue to innovate in this field to strengthen its leadership position.
Resources necessary to assure the plan’s success
Renault will improve its competitiveness through a cost reduction programme, optimised investments in all areas, and the benefits from synergies developed with Nissan within the Alliance. It will focus on:
- Reducing purchasing costs by 14% in three years;
Cross-functional management that is focused on customer satisfaction and driven by profit is being established through regional management, globalised functions, programme management and 11 cross-functional teams.
Renault, the most profitable European volume car company
Renault’s performance will be measured by the increase in its operating margin. The company commits to reach 6% operating margin in 2009. This achievement - which will be a record for Renault - will be surpassed the following year. This commitment will make and sustain Renault as the most profitable European volume car company.
A linear and significant increase in the dividend – from 1.8 euros per share in 2005 to an objective of 4.5 euros per share in 2009 – will be proposed to Renault’s board of directors, who will submit a yearly resolution to the annual shareholders’ meeting.
"With a clear vision, and prioritised, precise and measurable objectives, I am convinced that Renault will become, in the framework of the Alliance, a great company with sustainable high performance in the global automotive industry," said Ghosn.
1. Luxury vehicles are those
with a sales price above 27,000 euros, according to the price commonly used in
the global automotive industry to define models in that segment.