Renault Sa Unsp/Adr

Good morning, everyone, and welcome to our 2025 Q1 revenue presentation. This presentation will be made by Duncan Minto, CFO of Renault Group, and will be followed by a Q&A session. Duncan, the floor is yours.

Thanks, Philippine. Good morning, everybody, or good afternoon, wherever you're joining from around the world. Pleasure to be with you this morning to present the Group Q1 revenue results for 2025. So, in Q1, Group revenue was broadly in line with last year at €11.7 billion. Constant exchange rates it was up 0.6%. Automotive revenues stood at 10.1 billion euros, down 3%, or down 2.2% at constant exchange rates. Mobility services amounted to 23 million euros, up 8 million compared with last year. Mobilise financial services revenue was up 22.3% to €1.5 billion, mainly driven by the increase in average ticket per vehicle and still benefiting from growing interest rate trend over the last years. It increased by 23.5% at constant exchange rates. So moving on to the drill down of the automotive revenue. They stood at 10.1 billion euros, as I said, down 2.2 at constant exchange rates, with a negative forex impact of 0.8 points. As in previous quarters, this impact was driven by the devaluation of the Brazilian Riais, the Argentinian Peso, and the Turkish Lira. As you know, the Turkish Lira has a positive impact on our production costs though, so it's not all bad news. The second part is the volume. Volume effect was negative for minus 2.6 points in the quarter as the growth of 2.9% in group registrations was offset by a higher destocking at independent dealers this quarter compared to the same quarter last year. We'll come back to this in just a second. So to look into the registrations, the 2.9% growth worldwide in Q1 translated to 565,000 registrations at the group level. In Europe, we confirm our number three position in passenger car and light commercial vehicle market with 402,000 registrations. That's up 2.8% in a market that was down 2%. The situation is quite different between passenger cars and light commercial vehicles. In Europe, for passenger cars, we posted a 10% growth in a market down 0.5%. We strongly outperformed the market in all major European countries, with particularly strong growth in Spain, UK and Germany. In the latter, our sales were back to growth in a market that's still down. We remained and we will do fully focused on sales quality and we use four key PIs internally. First, the retail channel represented 58.5% of passenger car group sales. It's around 17 points above the European market average. Second one for us is pursuing the conquest as previously announced of the C and above segments in our five main European countries. For the Renault brand, they represented 40.6% of the brand's European sales. This is up four points compared to last year, driven by Rafale, Espace, Scenic and Sambios, in addition to Arcana and Austral, and soon completed by the C-SUV for International. At Dacia, the launch of Bigster will open the way of the conquest of the C segment as of Q2. Third KPI for us is the version mix. So top of the range versions continue to represent a significant share of our mix. At Renault, the Esprit Alpine and Iconic versions represented 27% of the mix in Q1. It's an increase of seven points compared to last year. Adacia high trim mix represented 71% of sales of Duster and 64% of Jogger in Q1. Finally, we keep preserving our focus on residual values on passenger cars, which remain in the scale of 4 to 13 points above our peers. This will be continued in our ongoing product offensive and we continue to track these four KPIs as part of our key plan. On LCV in Europe, the situation is quite different. On top of a decreasing market of close to 12%, we had to cope with the end of sales of Express last year, not yet fully offset by Kangoo, and the progressive ramp-up of Newmaster, which has not yet reached its full diversity. As you know, it always takes longer to deploy an LCV because of the large diversity compared to the passenger car range. LCV's performance should improve by the end of H2 with the availability of the full diversity of master. So this was for Europe. On international markets, we enjoyed double-digit growth in all regions except Eurasia, strongly outperforming in all markets, plus 21.1% in Latin America, more than doubling the growth of the market, and 13.9% in Asia-Pacific, versus a market up 4.2%. Africa Middle East was also up 12.3% in a market that grew by only 5.5%. Eurasia is the only exception due to Turkey, which suffered from an unfavorable comparison base last year in Q1 2024 in relation to the anticipation of sales pre-elections. and accentuated by the change of branding strategy we have for Duster, switching from Dacia to the Renault brand. Looking at the Renault brand, it continued its progression in Q1 2025 with global sales up 6.5% at 389,000 units. In Europe, passenger car sales were up 17.7% and strongly outperformed the market which was down 0.5% thanks to the success of Renault 5 and hybrid vehicles combined with a continued growth in C segment and above. Looking at passenger cars and light commercial vehicles, Renault ranks number three in Europe, number one in France and Spain. Clio is also number three in Europe across all channels. On LCV in Europe, despite the market and our transitioning product plan, the brand remains number two. Overseas, Renault started to benefit from the strong success of our international game plan. In South Korea, sales were boosted by the strong commercial success of Grand Corios, launched in September last year. The SUV is currently being launched in Gulf countries and in Latin America. The progressive deployment of Cardian in Latin America drove a 21.1% sales increase in Q1, with particularly strong growth in Argentina at plus 89%, and Colombia plus 40%, followed by Brazil plus 11%. Cardian's launch in Morocco in December contributed to the 45% sales growth in the country in Q1. Renault brand is pursuing its electrification strategy. EV sales increased by 88% in Q1 compared to last year. After a remarkable progression of EV mix throughout the year in 2024, we started at 10.7% in Q1, we're at 16.2% in Q4. EV mix increased again in Q1 2025 to reach 17.1% of sales. This increase will be pursued with the ramp up of our recent EV launches, Renault 5, Scenic, Newmaster, and with a launch this year of Renault 4. Renault 5 E-Tech is the number one EV in France across all segments, the number one B segment EV in Europe. Its deployment in Europe is still ongoing, notably in the UK and the Nordics. Hybrid sales increased by 46% in Q1 2025, further driving the continuous increase in our hybrid mix to 44.1%. We were 35% in Q1 in 2024. As we went out of Q4, we were 38%, so the strong dynamic continues. The brand also confirms its second position in the hybrid European market, thanks to Clio, Captcha, and Sambios. All in all, electrified sales represented 61.2% of Renault brand sales in Q1. At the group level, electrified sales mix stood at 44.2% in Europe, up 15.3 points compared to last year. With a hybrid mix at 31%, up 10.2 points and an EV mix at 13.2%, which is up 5.1 points. Turning now to Dacia, Dacia outpaced the market with sales up 0.6% in Europe at 154,000 registrations despite a market down too. Sandero is once again the best selling car across all channels in Europe in Q1 with 68,000 units sold. Duster sales increased by nearly 12% with 50,000 units sold and remains the best selling SUV in retail. Bigster is getting ready for its launch in Q2. It embodies the Dacia offensive for the C SUV segment. It's already recorded more than 13,000 orders, largely above the plan and even before its arrival in the dealer network. Worldwide, Dacia recorded sales down 2%, mainly, as I said earlier, to the switch of the brand strategy for Duster in Turkey, which is now sold under the Renault brand as per the international game plan. Turning to Alpine, which recorded more than 2,000 registrations in Q1. It's always double compared to last year, as we have the very start of the ramp-up of A290, the first sporty electric hot hatch in France. In March, the Alpine A110 lineup evolved with two new versions, the GTS and the R70. The R70 is a limited series of 770 units to celebrate the 70th anniversary of Alpine. We will celebrate that on May 27th, 2025, where we will present the new A390 in Dieppe next to Alpine Dieppe Jean Redelet Manufacture, the name of the plant in which it will be produced. The future five-seat sports fastback will be the brand's second 100% electric model. Turning from the brands to the inventories, I did say that the growth in sales registration was offset by the negative impact of stock evolution. Inventories at the end of March 2025 stood at 560,000 units. This is slightly up 20,000 units compared to December due to a restocking at the group level in line with a regular seasonal pattern. It will allow us to operate smoothly and be prepared for the ongoing launches we have coming up. This stock increase at group level is partially offset by a destocking at independent dealers in line with regular seasonal patterns. Looking at the impact on our volume bucket in the walk-down, this quarter destocking independent dealers was stronger. As you can see on the graph, 97,000 units in Q1 2025, which is more than the same decrease in the previous period, which was 73,000 units. last year, so this larger destocking impacted negatively our volume effect. We continue to implement a strict discipline on the management of our global inventories and we confirm that we will reduce total inventories towards the end of H1. The total stock is underpinned by sound order book. We stood at around two months of forward sales at the end of March with indicators all clear on aging and customer matching. Return from stock to partners in the next part of the walk down. Sales to partners had a negative effect of 3.5 points in Q1 2025. mainly due to the high comparison base, we had two things. First, a positive R&D billing one-off was recorded in Q1 2024. And second, revenues from powertrains have been deconsolidated as we move to horse at the end of May 2024. These two impacts explain most of the decrease. In addition, we're also in a transition prior to the production of Nissan Micra, which will come in H2. I think this will therefore turn back to positive in the next nine months of the year. If we look now at the price, product mix and geographical mix impacts, As expected, the price effect was stable in Q1, though positive at 0.5 points, reflecting a phase of price stabilisation. As already mentioned, Rena Group aims to offset negative currency effects by pricing actions, while giving a portion of its cost reduction back to its customers, mainly through content. This way, this supports the competitiveness of the Group's vehicles while protecting margins. The product mix effect was solid at 3.7 points, explained by the ramp up of new models, Scenic E-Tech, Sambios, Rafale, Renault 5, Gran Collios, Duster. New models represented in the quarter 28.3% of our invoices. This was 5% back in H1 last year, moving to 18.2 in Q3 and 24.7, so The acceleration to 28.3 confirms the dynamic. It will continue to be a key driver in the coming quarters. The positive impact of new products more than offset the negative impact of the transition between Master 3 and Master 4 that should improve, as I said, with increase of diversity towards the end of the year. The geographical mix stood at minus 0.7 points, mainly due to the increase of sales in Latin America, thanks to the rampart of Cardian, and to a lesser extent, the increase of sales in South Africa. The last item on the walk down is other, which impacted our revenue by plus 0.4 points. This was mainly driven by the solid performance of the after sales business. So having gone through the auto revenue, let's move to mobilise financial services. New contract production was stable over Q1 2024. The average performing assets increased by 8.9% to 59.1 billion euros, mostly thanks to the increase in average ticket per vehicle over the last years. All in all, mobilised financial services revenues were up 22.3% to €1.5 billion, mainly driven by the increase in average ticket again and still benefiting from the growing interest rate trend over the past years. So looking from Q1 towards the end of the year and before going into the Q&A, I'd just like to confirm our guidance for 2025 with a group operating margin above 7%. and a free cash flow above €2bn. Cost management continues to be a key priority for us. In this unstable macroeconomic environment, we have decided to proactively engage additional cost reduction measures internally. These effects will enhance our competitiveness. Above that we have seven launches and two facelifts this year. Bigster, which will be available in both internal combustion and hybrid versions, will be the first to be launched in Q2. It's currently arriving at dealerships in Europe, but has already enjoyed strong orders, largely above our objectives, as I'd already mentioned. Renault 4 will arrive at the end of Q2, together with the facelifts of Vespas and Austral. They'll be followed in H2 with A390 for Alpine and two new vehicles for Renault, of which a C-segment for international markets. So yes, external environment may be complicated, but you can count on us to continue to accelerate and for once we're not directly exposed to the headwinds, allowing our teams to remain fully dedicated to the execution of our strategy and the preparation of our next strategic plan called Futurama. So, that concludes my presentation. Thanks for your attention this morning, and with Philippine and the team now ready to take your questions.

Thank you, Duncan. So, we now start the Q&A session with Horst Schneider from Bank of America. Horst, please, could you open your mic?

Yes, good morning. I hope you can hear me. The first question that I have relates to Europe. You say you have got this two months of order bank now in Europe. I think that is in line with the normal level. We heard recently from Volkswagen that they are running extra shifts. And I think they were also talking about rising orders. So maybe you can talk a little bit about the recent order trends that you saw in March and also going into April. if you can confirm that the market is maybe moving better or or maybe also worse so any color would be helpful on that the second question that i have relates to financial services because again financial services draws revenues stronger than i would have expected so in that context i know it's always a trade-off between rising ev sales which are more supported by financial services business but then also Duncan, you said it right, that interest rates decline and then also revenues should decline. So how should we think going forward about this financial services revenues? Is the Q1 a run rate we can just take times four or will Q1 revenues or Q2 revenues then again be smaller because of declining rates? Or how should we think about the revenue growth in financial services? Yeah, these are my two main questions for the time being.

Horst, thanks. Good morning to you. The two months order bank is good news, stable for us. It's what we're targeting to do in terms of matching the order book we have and the stock level we have. Evolution, I'd say, I can put it out to both Denis and Fabrice if you want to add any additional comments. Not sure I'm seeing any major moves at this point. Obviously, we're benefiting from a very strong product dynamic and launches on our side.

What we see, what is interesting in Europe up to now in terms of orders, is that we see a qualitative move to hybrid and EV trend. EV is improving and hybrid much more than the market. and we have in both brands the right products to feed this growing demand. Regarding the orders, we are up versus last year, but what is more important for us is to maintain this two-month order bank with the agility of also controlled stock to tackle the next month. Regarding the environment, of course, we don't have any I would say we don't have any forecast to give to you. We are vigilant about the environment, but with the right products on the right segments, which are growing now in Europe, this is the most important for me. I don't know if, Denis, if you want.

Yeah, same thing for Dacia. Orders are up, but a lot of uncertainty ahead, so difficult to predict. Still, we have boosters here, as for Dacia, the bigster, as we said, is starting. So, of course, it will be in the next quads, a big booster in the volume. And as we speak, it is in the order take, of course.

So if I go to your second point, Hosh, which was on MFS revenues. So yes, interest rates, I mean, it's obviously the MFS revenues is the portfolio that we have. So there was the interest rate had risen over the past years. That's what's driven that and it allows to have a stable forecast in terms of what's going on for the rest of the year. So you can expect that to remain stable. solid um and you know you can see in our revenue drivers on the car side what we're selling is benefiting from you know a stronger product mix on the revenue each side so higher average ticket prices all the time obviously as you quite rightly pointed out ev sales is is a boost in that because of the high penetration of mfs selling onto retail customers as well

And we can expect then that this run rate takes time, we can take the time for, or how should we think about that going forward?

Because it's the average of a portfolio over the last, let's say, average of three years, you can expect it to stay in the similar range going forward. All right. Thank you.

Thank you. We now have a question from Philippe Uchois-Jeffries. Philippe, please, could you open your mic?

Yes, good morning. I hope you hear me. Thanks for a low stress morning with inline numbers. A couple of questions for me. One, on the tariff side, I know you're not directly exposed, but I'm just wondering what you hear and see both from supplier stress potentially and from competitors potentially also redirecting volume to other markets as the US market gets less attractive. Any color on that would be welcome. And then the second point is on the light commercial vehicles. We know it's been a weak market. You underperformed. The other topic that's discussed is the issue of CO2 compliance on that segment. So first of all, any indication in terms of your compliance, generally speaking, in Q1 at Renault level, and then specifically what you're putting in place to either comply on LCVs or try to change the regulation, which seems unachievable. Thank you.

Morning Philippe, thanks for the questions. So on the tariff front, as you quite rightly point out, we're not directly exposed. So I haven't seen any change so far in any reaction in the markets we're exposed to because of that. Obviously, we've seen, as you will have all have noted, some foreign exchange fluctuations and devaluation in Latin America, but nothing directly related to tariffs from us. No particular warnings to signal in terms of suppliers that are disruptions or anything like that. Steady as she goes for the moment. On LCVs, yes, it was a weak market, and as you pointed out, in that we have the product change with Master and also the reduction of the stop of Express. CO2 compliance was still waiting for CAFE to be voted, which we expect around the summer, which would look for the bank and borrow, and as it stands, three years is the proposal which was on the table for both the passenger car and the light commercial vehicle. So we have, as Fabrice said, the demand is stronger and the growth is there in segments which are on hybrid and also on EV. Denis said he's got Big Slick coming which adds another electrified vehicle to the Dacia range. So I know the question was specifically on LCV, but in general our outlook for the CO2 compliance is in line with our expectations.

And you know that for the CO2 targets, for the industry, not for Renault Group, we need to be between 20% to 22% of EV mix. You also know that for Renault Group, the target is below this range. Because first, we have a very strong hybrid penetration. As you know, we are number two on hybrid in Europe. And also because we are, you know, on average, we have a smaller car than the European industry. So our target is below. Now, if you look at our figures, at Renault Group level Q1, we were at 13% BEV mix. And for the Renault brand, we were a bit above 17%. So both at Renault Group level and at the Renault brand level, we are starting to see the success of our EV lineup.

Thank you.

We now have a question from Renato Gargiulo from Intesa. Renato, please could you open your mic?

Yes, can you hear me? Good morning all. Yes, my first question is on the product mix, which you confirm should remain the main driver this year. It was at 3.7% in the first quarter. As you expect, the contribution from the new models, which were at 28% of total invoices in the first quarter, to further increase ahead, can we assume a slight further improvement in the product mix ahead in the next quarter? quarters or can you give us any indication about the trend for product mix? The second question is on inventories. Can you give us any indication? Yeah, you stated you expect this to decrease your own inventories by the end of the first half. Can we expect in terms of magnitude a similar trend versus last year in the first half? And also going forward, what can we expect for the remainder of the year? The last question, a more general one. Clearly, you stick to your margin guidance for the full year, which is including, as we know, the 1% negative CAFE impact. But as we know that this regulation is going to change, can you give us an indication about, let's say, the potential evolution, the powertrain mix, and potential benefits over the second half? I'm just trying. Thank you.

Thanks, Rilotto. Good morning to you. Thank you for the questions. Yes, as we called out at the beginning of the year, the product mix would be... a positive driver for this year, so the 3.7% increase in Q1 was a solid start for that. I think this will stay as a driver throughout the three quarters to come. It could be slightly more positive than that, but it's in this order of magnitude, so I confirm that that remains, as stated at the beginning of the year, one of the most positive drivers for the revenue per unit. In terms of inventory decrease, we talked about order take being well matched to our stock levels at the moment. Obviously we've started to see the reduction of independent dealer inventories as the order bank was being delivered. with a strong dynamic of the portfolio. We will target to lower slightly inventories to the end of H1. We are in a sales growth environment, so it might not be as low as June last year, but certainly close to that, similar levels. In terms of CAFE, we had called out on the margin that it was an impact for the full year. Obviously, once again, nothing has been voted yet, so we're still continuing to deliver the same mix that we planned. We have flexibility within the Renault Group, so as Fabrice said, we're constantly adjusting order book inventory to demand, and we can adjust production going forward, so we could look if everything came in to increase certain ICE versions, taking opportunities that exist in market trends as well. But we won't go back against the fact we want to be CAFE compliant. Obviously, the average of the three years helps us manage that more longer term as an industry and also for Renault. You know, the growth is coming from EV demand and also in hybrid demand as well. And that's where we are launching the new products. So nothing new on that front. We're just waiting for the vote to come in. Perfect. Thank you.

Thank you, Duncan. Thank you, Renato. So now you have a question from Rosse Asumendi from J.P. Morgan. Rosse, please, could you open your mic?

Thank you. Good morning, Duncan. Apologies, the question has been asked already. Just a question on sales to partners and the evolution we should expect a little bit through the year. And what a little bit the driver's first half, second half on sales to partners. I'm trying to get also to the EBIT contribution also on sales to partners, as it seems to be uh you know in a way of setting a little bit the the product mix so maybe how should we think about that balance and then second you know duncan for you know in terms of um i guess a question for luca but but uh there's a lot going on right now right now collaborations uh with obviously the partnership with nissan and gilly any developments any any projects any things that sort of have been um you know that you would note in the first quarter of the year thank you

Thanks, Jose. In terms of sales to partners, you noticed there were a couple of one-offs in the same quarter last year with some R&D billing. So the fact when we take those out, the sales to partners actually isn't that far down. And we will have a more positive dynamic as the year goes on, particularly the launch of Micra within the Ampere team. as from H2. I do expect that to be a positive driver compared to the decrease we've seen, which is a one-off comparison basis main issue. In terms of collaboration, what went on in Q1, we did make the announcement with Nissan in which we purchased the full ownership of our APL in India. We had also the confirmation from Nissan We'd want to do a vehicle on the Twingo platform as well, which is another confirmation of the competitivity of the offer we have on the Ampère site. So we still have a strong dynamic in speaking with our partners and looking at opportunities and making those work wherever it's positive for all parties.

Quick, quick follow up. You mentioned, you know, some, I believe you mentioned some incremental cost initiatives to react to the volatile environment out there. What can you, what are you thinking about in terms of the shortened measures on P&L or on cash flow?

On cash flow, I guess it's managing the purse strings, which is a natural reaction when the external environment is not clear. On cash flow, it's the same managing our inventories. As we've already discussed, bringing them slightly down. We're still well matched on order to production outlook. We continue to have a strong focus on receivables, working capital. And on the cost side, we're not talking about any radical moves. It's just prudence, which I think is natural reaction in this environment. What doesn't need to be spent doesn't need to be spent. Some of the studies, you know, if you want to... We said that we would look to commercialize Alpine in the US. Considering what's going on in the US at the moment, I don't think it's the right time to be spending on those studies. We've postponed that. Obviously, we're not taking any decisions and don't need to take any decisions that would change the lineup or air vehicle schedule. No major impacts, but I guess both Denis and Fabrice would know they're in their own houses, making sure we're managing spend and what doesn't need to be spent gets postponed.

Thank you very much. Thank you.

We now have a question from Steven Reitman, Bernstein. Steven, please could you open your mic?

Yes, good morning. Thank you for doing the call. As well as winning a lot of awards, the R5 is also getting very good press reviews, of course, as well, and seems to get very good reactions. Could you comment on the pricing and how that compares relative to competitors in the B-segment, BEV space, price realizations, how that's going? If you could comment maybe also about waiting times across Europe in the different key markets. Obviously, you've said it hasn't been rolled out in all countries yet, but in the markets where it is available. And also, if we move also to F1 and Alpine, Obviously, the move to switch to be a customer engine team, what kind of impact is that going to have on costs going forward? And when will that sort of maybe make an impact already be visible in the render figures? Thank you.

Yes, coming back to your question on R5 and to have the big picture, of course, for Renault brand, the challenge this year was the electrification for two reasons, CO2 and growth, because these are the segments where we can catch the growth. And we decided on purpose to have a lineup based on two legs, on one end BEV and on the other end, full hybrid. If I take the full hybrid evolution, we are on the first quarter at plus 46% in terms of sales, Europe PC sales, versus a market which is at plus 12. It means we are over-catching the growth. Regarding BEV, of course, Renault 5 is playing a big role because we are increasing by 87% our BEV sales since the beginning of the year versus last year. in front of a market which is increasing by plus 27%. It means we are also over delivering on the BEV segment, thanks of course to the first 30,000 sales of R5. The move from R5 is very important because it shows that the B segment market in Europe is capable to shift to BEV cars. And this is a big trend. Of course, we will benefit first with R5 and on the second part of the year with R4. If you take the ramp up of R5, of course, we have now a delay between two and three months, depending on the countries. We focused on the first ramp up in France and on the main markets in Europe. but we have still a lot of potential. For instance, we are just beginning our deliveries in the UK now. It means we can expect further growth on this car, which is already number one on the B segment in Europe and number one on the B segment in France, Germany, Spain and Belgium, and number one EV in France. I think that's okay.

In terms of pricing?

In terms of pricing, what we can see on R5 is that we are first delivering the highest version. We are on the highest autonomy level with the iconic level which is doing most of the mix. I think we don't have any reason up to now to change this balance between volume and pricing.

Thank you. Stephen, your question on the switch for engines on the F1 side. We continue to use the internal engine produced at Viri in 2025 and the switches to Mercedes engine in 2026. So the cost gain for the company is over the two years. So we still have production costs today, but we are no longer developing the 2026 engine. So part of the synergies are already coming in 25 and the rest of them will fully come in in 26. Thank you.

We now have a question from Henning Gossmann, Barclays. Henning, please, could you open your mic?

Can you hear me now?

Yeah.

Hi, good morning. Sorry about that. No, great. Thanks for the call so far. I just had a clarification again on the 100 basis points and the guidance. And thanks, Duncan, for your comments there. I think you said that you're currently still delivering the same mix as you had planned if you would have had to comply in 2025 itself. So just to clarify, can I understand if the new regulation now does get voted on Is it the plan to take advantage of that and change the mix to be able to benefit in margin terms in the second half? Is that the understanding? That's the first question. And then the second question is, um is uh i mean it's obviously a revenue call but just on the mix because in the mix of course you you have two um accretive elements normally which is lcv and bev which positive for the revenue mix um but bev is of course diluted for the for the profitability mix and you've emphasized a few times on the call the transition of the master as well so If you could just help us directionally, if there's anything in terms of drop through from the product mix line that could be weaker, specifically for higher BEV, especially in the first half, lower LCV, especially in the first half, that we should be aware of when translating product mix into the EBIT bridge. Thank you.

Okay, thanks, Henning. On the 100 basis point impact of cafe mix, I said yes, we were basically still delivering the mix we planned. At the end of the day, we're delivering the mix that the customers are ordering. So we are seeing strong growth in EV demand. We're matching the growth and outpacing the market on hybrid as well. We're not forcing anything and we're still in line with what we planned. Obviously, if things are voted at some point, that will allow us to look at taking opportunities of additional production capacity where we may have cut some higher CO2 emitting vehicles. But this is not done yet. Let's speak about that when it comes. On the revenue we talked you said about mix so LCVBV so once again we expect this product mix positive to continue throughout the quarters maybe even strengthen off the base we already presented in Q1. As you said, it's a revenue call, so thinking about the drop down to margins, you have to look at the whole thing. Successful new product launches are good news. It's ramping up throughout the year. We talked about the percentage of invoices already in Q1 at 28%. We have EV, we have LCV, which is ramping up as well, stronger in the H2. And we also have a successful product portfolio in the C segment. Sambiosis is ramping up and we have now over 40% of sales in C segment above on the rally round. Bigster coming out in Q2 as well, which will be the highest revenue per unit And let's not shy away from the fact probably most profitable vehicle within the Dacia range as well. So I guess good things to come.

Thank you. So in summary, no weaker drop through to be expected. That's a fair summary, is it, than normal? If you look at the whole thing together to your point.

No, things are tracking as we planned. Obviously, we did call out that we didn't think we'd be in 2025 in a scenario where net pricing was massively up. It's more price stabilisation benefiting from the cost reductions we have to be able to offer our customers a very competitive range and equipment within the cars, which is also reflected in the registration numbers you see. Growth of 2.9% in the quarter. you start to drill into it, you know, passenger cars are up 10% in the market, down 0.5%. So we're delivering our plan. Appreciate it, Duncan. Thank you.

Thank you, Duncan. Thank you, Aileen. So we now have a question from Stuart Persson from BNP. Stuart, please, could you open your mic?

Yeah, good morning. Hopefully you can hear me okay. Yeah, so thanks for the call, Saifah. Just a few follow-ups, I guess. I mean, firstly, on the CO2 side, I mean, I take the point that you're on track with your plan, but an EU-BV mix at 13%, even with a hybrid, suggests you're some way behind the target, I would have thought. So, I mean, can you rule out that you'd have to provision for any CO2 finds in H1 in the way that Volkswagen has done in Q1, even if they were later reversed, if the reprieve were voted through? So is that something we should not expect even a temporary effect in H1. So just wanted to get your views on that. And then just coming back to the pricing side, I'm kind of intrigued what's driven that too. I know you've mentioned it a little bit, but I'm just a little bit confused on the message on whether we should interpret the fact that that pricing split positive, whether we should interpret that as being indicative of improving pricing in Europe overall. Is that just the impact of new models? And so how much that will drop through to the EBIT bridge? And I guess my secondary point on that is, what are you seeing on used prices? I mean, are they starting to improve? Is anything changing in your finance offer that's really driving that 50 basis points of improved pricing? Or is that achieved with a like-for-like finance offer? Just wonder if you're changing anything on the finance terms to get to that pricing. Because I'm just not sure really what we're seeing in Europe is an overall improvement in pricing. And then lastly, just on the 28.3% of new models, just wondering if you have any indication of where you think that can get to by the second half of the year. Thank you.

Good morning, Stuart. Thanks for the question. So CO2, as long as we foresee to be CO2 compliant across the period of the three years, if we were to be slightly under in the first year, I don't foresee that we'd have to provision that as we would expect the law to be voted or close to be by the time we present.

Sorry to interrupt, I just meant before that's voted through, which presumably might not be the case by July, so you have to behave as if it hasn't happened yet, would you have to provision in H1?

I don't believe so, no, because I think we're, it's the same as the UK as we have in the current scenario and the treatment we have of that. So I think as we get to, obviously we're not presenting our P&L today, just the revenues, but as we get to H1 presented at the end of July, I expect we'll be comfortable on that front. In terms of pricing, we need to look at this as a whole. Obviously, we're seeing the impact of the new model launches coming through in the product mix. We have pricing which is slightly up, 0.5 points positive. And we are compensating for some devaluation in international markets within that bucket as well. And we'd said we call out for net pricing mix enrichment to be able to cover any of the additional content and obviously will benefit on the margin bridge from the cost reductions on the variable side we have as well.

Regarding used car prices, two points. First of all, we are very stable in our residual value. Thanks to our consistent policy in terms of pricing and our technological choices, it means there is no change or no alert on the residual value side. And that's why also on the used car business, our dealers have a normal stock and the prices are quite stable versus last year. It means for me, up to now, absolutely no alert on used cars, neither on used cars nor on residual value from our side.

And just coming back to your question on pricing, the strategy is still the same, meaning it's value over volume, unlike others. And you need to continue to make the difference between what is happening at the revenue bridge and what is happening at the operating margin bridge. So as we already mentioned, we already entered a phase of stabilization in terms of pricing. This is reflected in the 0.5 points of pricing effect in Q1. And throughout the years, we will continue to have this stable pricing effect. Then when you look at the operating margin bridge, we continue to manage it with the combination of price mix enrichment and cost reduction. And all together, we want to have a positive and it will continue to drive the performance. Now we have a question from Thomas Besson.

Just maybe one second. On the 28.3% of the new vehicles was the last part of Stuart's question. So yes, I do expect that to continue to increase throughout the quarters. It has obviously ramped up since the 5% in H1 2024. So dynamic will be to increase.

Thank you, Duncan. We now have a question from Thomas Besson. Thomas, please, could you open your mic?

Good morning. Thank you. I hope you can hear me. As I come a bit late in that call, I'm going to try to ask questions that are not exactly... in that type of call uh can you help us understand the uh the dynamic in terms of seasonality uh for profitability uh and free cash flow uh in 25 i mean over the last three four years you were in a constant increase in profitability except last year where we saw something more similar to what we normally see in europe with a stronger first half weaker second half In this specific year, you have a lot of conflicting elements that make it difficult, I think, to gauge which health will be stronger. Can you give us some indications on that? That was the first question. And the second, on CapEx 425, I mean, you're investing again i think uh is it reasonable to expect capex to increase and be a headwind to your two billion plus free cash flow uh in 25 or it's something you you will be willing to comment more in july thank you thanks what was the last part of the willing to be more on capex you said my question was whether your capex would be increasing and be a headwind to your 2 billion free cash flow target

Okay. Sorry, I just wanted to make sure I got it. Thanks for the two. So yes, seasonality of the year. I expect this year will be a year in which H2 will be stronger than H1. Obviously, we have the desire to decrease stock at the total level. You've already seen the independent dealer network has had a strong reduction in Q1, and we would like to bring the total down slightly. for the end of June. We also have obviously the horse comparison, which was a big positive in the previous year in H1. And we said that we expect to see some dynamic in terms of the cost reductions coming from horse as of H2. So that's more of an H2 question than H1. And I guess a lot of the call this morning has been about the strong product dynamic. And so as that ramps out, The more of the impact, the profitability is not always at launch, but it's in the coming months. And so that'll be another element which points to a stronger H2 than a stronger H1. CapEx, obviously we're not delaying anything on any of the product lineups, so we continue to deliver what we had in the plan. I guess maybe the one element on stronger CapEx than we'd initially planned was obviously with the purchase of 100% of RNIPL. If that goes through towards the end of H1, we'll see probably an impact of H2. where we could have 200 million additional capex for that. That's purely because the product portfolio is literally just about to be launched in 2026. They've got four new models coming in terms of production. Those models are being installed and it'll calm down a little bit in 2026, but it's really the peak. That's what I want to call out on the capex question.

Thank you, Duncan.

Thank you.

We now have a last question from Pushkar Tendulkar from HSBC. Pushkar, please, could you open your mic?

Hi. Thanks, Philippine, Duncan, and rest of the team, and good morning to you all. First question just on Nissan. Lots of news flow during the first quarter related to Nissan. it's kind of fair to assume that you won't be able to sell the stake that you hold in the trust back to Nissan given their financial condition. But just on the recent changes of your representation on their management board, what does that imply? Why? So that's kind of my first question. The second one is on the investment grade upgrade. Is there an update on that? And do you think that the current situation with tariffs for the industry, not necessarily for you, that kind of will hold back the rating agencies on that front?

Thanks, Pushkar. Maybe starting with the last one, investment grade. It's probably more of a question for the agencies than for us, but obviously we don't see the investors treating our debt as non-investment grade. Cost is more like an investment grade rating. So it'll happen when it happens. We continue the strong dynamic on the group and delivering in the plan we have. and the commitments that were taken. So we'll see what happens from the rating agencies side. I think we had the most recent one was Moody's.

Yeah, Moody's. So we just had a release from Moody's confirming the positive outlook for our credit rating. And it was clearly mentioned that Renault Group already met all the expectations to be investment-grade. But because of the macroeconomic environment, they want to wait, but nothing linked to Renault Group.

As for Nissan, you said a lot of news flow in Q1. Obviously, we had some positive news flow as well from both sides with the confirmation of the project in India and also the vehicle on the Twingo platform. We haven't made any further action on sales of Nissan shares, but as you say, we have them in the trust and we have the flexibility to do that and the flexibility for both partners was increased in the new agreement to take the lockdown from 15% to 10%, so flexibility on both sides. I won't comment on the changes in the board of Nissan because it's up to them to do that. Renault proposes directors to Nissan board but they're actually independent on that. And the board change would be proposed for a vote at the AGM. So that's the point at which it would be confirmed or not. And I believe that's towards the end of June.

Thank you. Thank you. So this is the end of this Q&A call. And as usual, the IR team is fully available to answer all your questions. So have a good day.

Thank you very much. Have a great day.