Renaulution, the repositioning of the Renault group’s brands

In live streaming on YouTube and presented in the style of an Apple Keynote, Luca de Meo, the new CEO of the Renault Group, presented the marketing and product strategies of the group's brands: Alpine, Renault, Dacia, Lada, and Mobilize.

Written by Par La rédac On 19/01, 17:27

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Renaulution, the repositioning of the Renault group’s brands

In the Renault Group, not to be confused with the Renault-Nissan-Mitsubishi Alliance, we had the following brands: Renault, Renault Sport, Alpine, Dacia, Lada. Luca de Meo, armed with representatives from each brand and his management team, presented the evolution and creation of each one.

In a conference worthy of Apple’s Keynotes, streamlined, with elaborate animations and a touch of the courses in Products, Marketing, and Communication from the top IAEs and Faculties, Luca de Meo identified the weaknesses, strengths, opportunities, and risks of each brand in the group. He also revealed in more detail Mobilize, already announced a few months ago as the brand for new mobilities.

The press release being very comprehensive, here is what you need to remember from this 2-hour and 40-minute conference.

A plan over 6 years

Renaulution means the evolution of Renault. The 6-year plan includes the following steps:

2021 – 2023: Direct the group towards better profitability with increased profits and a reduction in innovation costs from 10% to 8% of its revenue.

2023 – 2025: New products and new brand identities.

2025 and beyond: Being a leader in mobility and a pioneer in automotive technological innovations.

A complete repositioning of its brands

By 2025, the Renault group will have to launch 25 new products, including 10 electric ones. With 14 models announced just for Renault, including 7 fully electric ones, Alpine, Dacia, Lada and Mobilize will represent a total of 11 new models.

To avoid cannibalizing itself, and to create real added value and a strong image for each of its brands, the group has decided:

To focus all sports activities on the Alpine brand: Goodbye Renault Sport and Renault’s presence in motorsports. Alpine will now replace Renault in Formula 1 and will be in charge of the sports models. Alpine will also be a 100% electric brand starting with the next models. Alpine will notably collaborate with Lotus to design its next A110.
To give Renault a more technological image with inspiring design and the launch of 14 new models by 2025 mainly in the C/D segments. 7 models will be fully electric.
To introduce a shared car system and rethink the future mobility with the Mobilize brand, which aims to eventually generate 30% of Renault Group’s profits.

Increase your margin, reduce your costs

Luca de Meo’s first observation is to demonstrate that the group’s recent efforts to become the world’s number 1 in terms of sales have not paid off because revenue has not increased enough. Luca de Meo is therefore counting on a decrease in production but an increase in margins. This is typical of strategies to enhance a brand in order to give a greater value to a product. In addition to increasing the cost of vehicles, they need to be rationalized.

Luca de Meo thus announces his intention to reduce the number of cars produced from 4 million in 2019 to only 3.1 million in 2025. This represents a production decrease of 22.5%. That’s a lot.

Also, the number of platforms on which the various Renault group vehicles are built will drop from 6 to 3 (with 80% of the Group’s volumes on three Alliance platforms) while powertrains will decrease from 8 to 4 different families.

Luca de Meo also notes that most of the profits are currently generated in 5 European countries. He therefore wants to increase its presence in markets such as Latin America, India, and Korea.

In addition, the statement announces a target of reducing variable costs by 600€ per vehicle. This will be related to synergies between platforms, brands, or the improvement of partnerships with suppliers.