00:00What are you busy with? What's cooking in your kitchen?
00:02So the big focus for us is obviously to compete on price.
00:06We have a great lineup, great products that are doing quite well in Europe right now.
00:12We've launched Rono 5 last year.
00:14We're about to launch Rono 4, so below €25,000.
00:17And then we're attacking the A segment with a Twingo coming out next year.
00:21To be able to compete in Europe, it's all about reducing costs.
00:24And so we're making a lot of efforts to reduce costs.
00:30And in an EV, the biggest element is batteries.
00:32So that's where we're focusing.
00:33We have a commitment, and we're on track to go from the current C-segment car in the street to the next generation one, down 40% in cogs.
00:42Wow.
00:42So that's a significant reduction.
00:44But the EV segment is a very young technology.
00:48And so we see the opportunity, and we're working with our partners to actually achieve this.
00:53And a lot of these benefits will go to the customers, who can get great products for a lower price, and while maintaining profitability, obviously, and profit for Ampere.
01:03Is that – how do you remove cost?
01:05Just talk to me like I'm a kindergarten.
01:08I'm in kindergarten.
01:09How do you remove cost from – as much as 40%?
01:11That sounds like it's easy, but it sounds extremely difficult to do.
01:14Yeah, in the car industry, it's unusual.
01:16But in the EV space, it's quite common, in fact, because the technology is very young.
01:21So if I take batteries, batteries is 40% of the cost of a car, and the technology is changing really fast.
01:28In Europe, everybody was using a certain kind of chemistry, and it's changed, leveraging what has been done in China.
01:34So we're moving from NMC to LFP.
01:36And that allows for lowering cost of batteries in a significant matter.
01:40That's the chemistry.
01:41Then there's a geometry.
01:42There's a way the battery is integrated into the car, the way it interacts with the electric motor and the battery management system.
01:48A lot of steps in terms of how we manage this technology is still young, and all the engineers and all the OEMs in the world are working towards reducing this and optimizing it to get to an optimum that will come in a few years.
02:01That will be a little bit like in the ice part of the industry, where the technologies are much more stable.
02:07And when you do minus 5%, you're very happy.
02:09In the EV space, you need to go for something like minus 40% to stay in the competition and have products that stay ahead.
02:18That's an extremely tight sort of – one of the conversations that keeps – one of the parts of the EV conversation that keeps coming up here as we talk to, say, some of your partners in China and maybe some of your competitors as well,
02:30is all the innovation is shortening product cycles, innovation cycles, and I'm wondering how that is affecting how you plan your business because it seems things are just getting shorter.
02:43Good for the consumer, but I would imagine it's hectic for you guys.
02:46It's intense.
02:47So the acceleration is very clear for us, and we're very proud of this.
02:52So the Twingo, which will come out next year, will have a development cycle time of less than two years, 21 months, which is on par with what we see in China today.
03:01And actually, there's a derivative of the Twingo that will be known for Dacia that will be developed in 17 months.
03:06So we're very strong on that cycle time.
03:10We used to be at three, four years, and in just a matter of a few years, we've been able to accelerate.
03:15The way we've done this is we are learning a lot from what's being done in China.
03:20We've established –
03:21You have a center there.
03:22Exactly, a development center in Shanghai, so the Advanced China Development Center.
03:27And that allows us to study the ecosystem, to study the engineering processes in China, and we're learning a lot, and we're incubating this in our pair and applying it to our cars.
03:36And so you go from Renault 5, great product, great car, but three years cycle time, to Twingo, two years, less than two years, to the next derivative for Dacia, which will be 17 months.
03:47It allows us to reduce costs, to go faster, to stay closer to the market.
03:51And that's a key element of competition today in the segment, in the EV sector specifically.
03:56As CFO, what does it mean for your margins, though?
03:59It's really important for me.
04:00The less time, the less the engineers spend time on a car, the less cost there is in the car.
04:05They need to spend time on the car, though.
04:06They do.
04:07They do, but as long as the product is as good as it will be, Twingo is a great product.
04:12Right.
04:12I'm fine if they can do it faster.
04:14I think these are pictures of Twingo, if I'm not mistaken, here on the screens.
04:17Yeah, that's right.
04:18That's it.
04:19That's the Twingo, which is basically a modern reinterpretation of an iconic car in Europe from the 80s and 90s.
04:27This is a car that changed the approach to the A segment in Europe, and this is now the electric version, and that's bound to be a huge success.
04:37This one, the blue one, is a one of four.
04:39The green one, yeah, is a Twingo.
04:41And really, for the EV sector, what you need to understand is EV cars are more expensive today, and everybody is working towards getting towards price points that makes it much more accessible.
04:51So the C segment is very crowded, lots of big cars, everybody is there, and we're the pioneer in terms of getting towards lower, smaller cars that are cheaper and more accessible, and the B segment is the heart of the market in Europe.
05:04And we have products like Renault 5 today that are really very successful because it's a unique offering, very stylish, great product at an affordable price, and Twingo is the next step for that.
05:15Very quickly, final question for you.
05:17When are you going to break even?
05:19This year.
05:19So that's our commitment, and we're on track for breaking even this year, which in the EV space is really, really important.
05:27And so through our products and all the software activity that we have in Ampere, we're able to get to break even this year.
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