00:00We know that Renault doesn't necessarily have that much direct exposure to Gulf states,
00:06but I do wonder what's been the net impact from the Iran war on your company.
00:12Yes, thank you, Sherry.
00:14So, yes, less than 1% of sales are in the region for us in terms of direct exposure,
00:19but obviously there could be larger impacts on the supply chain.
00:22Today, so far, we haven't seen any impact, but obviously as an automotive manufacturer,
00:27we're very prudent about what could happen in the coming term,
00:30so cost is very much a focus for us.
00:35Exactly. You're trying to make your company leaner, right?
00:38If that's the case, I do wonder why you wouldn't share also some of your factories
00:43that are not running at full capacity with Chinese companies as well,
00:46like other European car makers are doing.
00:51Yes, Sherry, some European car makers, obviously the car market in Europe
00:54hasn't actually found the level it did pre-COVID,
00:58but Renault Group had done a lot of restructuring at that point in time.
01:02In terms of capacity utilization, unlike some of our peers,
01:05we're running over 90%, so we don't actually have any spare capacity to give away.
01:12How well are you competing with Chinese car makers like BYD
01:16that, of course, are becoming more popular in Europe,
01:19especially given, of course, the issues surrounding energy prices soaring?
01:25Yes, you have seen, as you referred to just earlier,
01:29a very large uptick in terms of EV demand in Europe
01:32since the beginning of the troubles in the Middle East.
01:36Whether this is a short-term thing or more of a longer-term thing linked to Renault's portfolio,
01:41because we have a dual strategy both on the EV car side,
01:45where we have a full portfolio of models,
01:48and on the hybrid side, which has been a very important part for Europe.
01:51But in order to go against Chinese competition
01:54and really raise the bar of the group,
01:57we had part of our Future Ready plan, which was announced very recently,
02:01the desire to keep fixed costs flat throughout the plan,
02:04to work on variable cost reductions,
02:06but I guess the most important factor is speed.
02:08And we've already proved that with the launch of Twingo,
02:11which we managed to launch within 21 months,
02:14which I think is a benchmark for Western manufacturers.
02:18Future Ready strategy also, as you said, is about really cutting costs,
02:22not necessarily prioritizing volume, right?
02:26In that sense, give us a little bit more of your strategy
02:30on how you would compete with these cheaper Chinese car makers.
02:36Yes, so Future Ready, one of the founding parts is about efficiency,
02:41capital efficiency, and keeping our fixed costs flat.
02:43But the plan is also a growth plan.
02:45At the end, in the auto sector, everything is about the product and the technology.
02:50So Future Ready sees us build our own independent technology in Europe,
02:55be that our EV platforms,
02:57in which we're seeing a lot of demand coming from partners outside,
03:00so external partners coming to ask us to produce for them
03:03due to the efficiency of these platforms.
03:06But it's also about growth for us outside Europe.
03:13For example, India,
03:14how is your joint venture in Chennai working right now,
03:18and what are your expectations for that market?
03:21Yes, thank you.
03:23It's a very key market for us.
03:24So India, we've been present for several years.
03:26We have over 5,000 engineers there.
03:28Back in March last year,
03:30we bought 100% of the factory RNA IPL from Nissan,
03:35which we've partnered with.
03:37Nissan stays a very important part of our business there
03:40because we will produce vehicles
03:42and develop vehicles for Nissan in those markets.
03:45And we've just seen the launch of Duster.
03:47Duster is the core of the Renault brand in India for us,
03:51and it's a really mid-segment car
03:54and focusing on value, as you said earlier,
03:56rather than volume.
03:58Because of the strength of the brand,
04:00because of the strength of the dealer network,
04:02we also have financing offers there
04:03and bringing new technologies.
04:05So India, in terms of growth for Renault Group,
04:07is one of the key factors in the Future Ready plan.
04:12On your partnership with Nissan,
04:13we heard from your CEO, Provost,
04:15that all potential options are open
04:17in order to make that alliance perhaps give out more results
04:22in the next two or three years.
04:24What do those options look like at this point?
04:28Well, as you may be aware,
04:30we have a lock-up in terms of cross-share holding at 10%.
04:33Nissan currently own 15%,
04:35and Renault have almost 36% of Nissan.
04:38And we've worked together in many years using platforms.
04:41I mean, if you look at what's going on right now,
04:43India, as we just talked about,
04:44is a key market for Renault,
04:46but also with new products coming out on our platform
04:49for Nissan in the coming months.
04:52In Europe, you're just seeing the launch of the Micra,
04:55which is on our small EV platform,
04:57for which we will also produce vehicles for Ford.
05:00So I think Renault, through the Nissan Alliance,
05:02has had a long experience of working in partnerships,
05:05and that gives us a strength maybe to work with Gili
05:08when we're doing on our horse,
05:10in terms of ICE and hybrid powertrains,
05:13with Gili in Brazil or in South Korea,
05:17and also for producing new vehicles for Ford,
05:19which they announced this week in Europe.
05:22When it comes to new products,
05:24Renault is also pushing into drone manufacturing.
05:27How big is the defense sector as a potential for your business?
05:33I think the defense sector in terms of the automotive sector
05:37is quite a large potential,
05:38but I think we need to be prudent at this point in time.
05:41Renault is reacting to a request
05:43that came from the local authorities
05:45to be able to use our ability
05:48to manufacture very efficiently,
05:50access volume parts,
05:52and produce very efficiently.
05:54So we are currently studying
05:55what can be done in that sector.
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