Luca de Meo, CEO of the Renault Group, believes that Tesla’s decision to cut prices on its electric vehicles (EVs) is damaging customers’ confidence in the value of their cars. Speaking with the Financial Times, he said that Tesla’s constantly fluctuating prices, including the massive cuts last month in the US, China and Europe, are destroying value for customers. He added that while he hopes Tesla continues to reduce prices to zero, Renault will continue to protect the value of its EVs.
De Meo’s comments echo complaints from Tesla customers who had already bought the US automaker’s EVs at higher prices and saw their cars lose significant value overnight. His remarks also send a signal to the markets that Renault does not plan to enter an EV price war.
Renault recently announced that its operating margins had doubled to 5.6 percent in 2022, while cash flow hit a record following a €3 billion ($3.2 billion) turnaround to cut costs. The French automaker is now the third-largest electric car brand in Europe, and second for hybrids behind Toyota. Renault has focused on selling higher margin vehicles, relaunching larger cars and abandoning its previous strategy of trying to increase sales at all costs.
Luca de Meo said the good financial results prove that Renault is “out of the emergency room and back in the game” after the company’s “fundamentals have been thoroughly cleaned up.” Renault sold 37,313 Zoe electric subcompacts and 33,000 Megane E-Tech Electric crossovers last year in Europe, but neither model made the top 10. The Dacia Spring did as the eighth best-selling EV in Europe in 2022 with 48,948 sales – the Romanian brand is a wholly owned subsidiary of Renault Group.
In conclusion, Luca de Meo’s comments about Tesla’s decision to cut prices on its EVs are a clear indication that Renault does not plan to enter an EV price war. The company has instead focused on selling higher margin vehicles and relaunching larger cars, which has resulted in improved financial results and increased sales.
:
FAQ
1) Are electric car batteries recyclable?
2) Are electric car chargers free?
3) Can electric car batteries be replaced?
