Renault cuts 2021 production outlook further as chip shortage shuts plants

Production of the Megane E-Tech Electric compact, due to reach the market early in 2022, at Renault's Douai, France, assembly plant.

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( AutomotiveNews )

Renault Group said production losses in 2021 because of a global semiconductor chip shortage would be far larger than previously forecast, but maintained its profit outlook thanks to high car pricing and cost cuts. 

The shortage of chips, used in everything from brake sensors to power steering to entertainment systems, has led automakers around the world to cut or even suspend production, pushing up vehicle prices.

The automaker said that by the end of September its order book had hit a 15-year high, for the equivalent of 2.8 months worth of sales. 

Renault said higher car prices meant that despite a drop of 22.3 percent in global sales, third-quarter revenue had fallen by 13.4 percent to 8.98 billion euros ($10.4 billion) from 10.37 billion a year earlier.

The company reiterated that its full-year operating margin would be around the same as the 2.8 percent it reported for the first half of the year. 

Higher sales of electrified models

During the third quarter, full-electric, plug-in hybrid and full-hybrid models made up more than 31 percent of sales, a 29 percent increase Renault said. Sales of the Zoe small EV dropped to around 47,000 during the period from more than 64,000 in 2020 as the aging model comes under pressure from rivals. 

But Renault said it had more than 30,000 orders for the Dacia Spring, the least-expensive EV in the group’s lineup. 

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