Article said that in the face of tough market conditions and heightened competition, Renault is outlining ambitious financial objectives for Ampere, its electric vehicle and software division. The company revealed its goal to achieve revenue exceeding €10 billion by 2025. This announcement precedes the planned initial public offering (IPO) for the Ampere unit in April-May 2024, with a targeted valuation ranging between €8 billion and €10 billion.[1] Renault's CEO, Luca de Meo, aims to boost investor confidence in Ampere amid concerns about sluggish EV demand and strong competition from Chinese manufacturers. Despite the challenges, Renault is committed to its plans, but may reconsider the IPO if valuations drop below €7 billion, according to insider reports.[2]
In my opinion, great news for Renault. I am confident that it could positively impact their stocks.[3] However, article did not end here. It continued that Renault is gearing up to launch a cost-effective electric vehicle aimed at competing with more affordable Chinese models, a crucial move as the company phases out some of its current EV models. With replacements like the Scenic and R5 set to debut next year, sales figures indicate that the electric Megane has sold 14,220 units, trailing behind Tesla's Model Y. Additionally, investment commitments from partners Nissan and Mitsubishi Motors could inject up to €800 million into Ampere, and Qualcomm is considering an investment in the venture. These strategic updates align with CEO Luca de Meo's broader restructuring plans for Renault, involving the separation of internal combustion engine operations from battery electric vehicle functions. The upcoming IPO is expected to showcase Ampere's potential in the evolving EV landscape.
Now if Nissan and Qualcomm are interested into this project, it means that there is a great chance for success. In hopes that Ampere will perform great, I have decided to invest into Renault stocks and wait for the IPO, which is expected next year.
Movement of Renault stocks in the last five years. (Source: Investing) *
* Past performance is no guarantee of future results.
[1,2,3] Forward-looking statements are based on assumptions and current expectations, which may be inaccurate, or based on the current economic environment which is subject to change. Such statements are not guaranteeing of future performance. They involve risks and other uncertainties which are difficult to predict. Results could differ materially from those expressed or implied in any forward-looking statements.