Renault revs up sales

Automotive Industries, July, 2005

ALONG WITH ITS SUCCESS on the race track, the Renault group sold 2,531,506 vehicles in 2005, a 1.7% increase on 2004.

According to the company, it secured a 4% share of the global market, with 2.5 million cars sold for the first time. Group sales grew by more than 21% on the international stage, while European volumes dropped by 4.1%. In 2005 the European car market was characterized by a stable market in Western Europe and a drop in sales in Central Europe. In a very competitive environment, Renault pursued its selective commercial policy, maintaining its place as leading brand for cars and LCVs with a market share of 10.3% for sales down by 4.6% compared to 2004. Thanks to Logan, Dacia had a remarkable performance in Europe with 30,425 sales, the company says.

Outside Europe, the three brands Renault, Dacia and Renault Samsung Motors contributed to the vigorous growth of its sales results:

* Dacia sales soared by 45.2% as Logan scored successes on all its markets.

* In Korea, the launch of the renewed versions of SM3, SM5 and SM7 allowed Renault Samsung Motors (RSM) to conquer new market share, increasing its volumes by 40%.

* The Renault brand increased its sales by 11.4%.

Renault continues growth outside Europe

Logan, launched in 2005 on 25 new markets, is now available in 40 countries worldwide under the Dacia and Renault brands. After Romania in 2004, Logan production facilities started up in Russia, Morocco and Colombia in 2005.

European markets experienced a more mixed year with a stagnant market in Western Europe ( 0.2%) and a slow down in Central Europe (-6.9%). Overall in Europe, the Renault group's sales fell by 4.1%. The group saw its sales rise by 50.5% in Eastern Europe to 174,112 units, ahead of a market improvement of 24.8%. In addition Russia increased Renault group sales by 85%, partly thanks to the launch of Logan under the Renault brand in a market that grew by 22.3%.

Latin America also saw Renault group sales rise to 164,258 in 2005, an increase of 11.8% in line with market growth of 13.2%. In Columbia, where Logan began sales under the Renault brand, sales grew by 33.9% to 23,800 units. Volumes also increased for the group in Argentina by 50.6%, after a number of difficult years for that economy, where overall car sales grew by 35.2% in 2005.

Another growth zone for the Renault group was Africa, the Maghreb and the Middle East, with a sales increase of 12.1%, ahead of the zones overall increase. Renault group sales increased by 30.9% in Morocco, 21.2% in Tunisia and 34.4% in South Africa, where Renault is the leading imported brand.

In the Asia Pacific region, group sales grew by 36.3% in 2005 to 130,606, mostly due to the success of Renault Samsung Motors which launched three new car models during the year. In addition sales were multiplied by eight in Malaysia thanks to the introduction of local CKD production of the Renault Kangoo, which began in December 2004.

Outlook

Looking ahead, Renault says it will continue to put in place its selective commercial policy in 2006, privileging the most profitable market sectors. In Europe, the Renault group's volumes should remain around the same level as 2005 in generally stable markets which will continue to be extremely competitive. In this context, the priority of the Renault group will remain profitability.

Outside Europe, the group will continue to pursue growth thanks to the Renault brand, the increasing presence of Logan, and Renault Samsung Motors which will consolidate its third position on the Korean market thanks to a rejuvenated range. Globally, the pursuit of international development and the first full year of sales of New Clio should translate into a new growth in volumes in 2006, with respect for the top objective for Renault, profitability.