2007 Interactive Annual Report - Renault

enault commitment 2009
Profitability:
renault
outPerforms
tHe oPerating
margin milestone
set for 2007
Profitability is the second of Renault’s commitments.
Despite a challenging environment
for the entire automotive industry, the
Group achieved the operating margin milestones
set for 2006 and 2007, with 3.3% in
2007 exceeding the 3% forecast.
Improved profitability is due mainly to efforts
by all business functions to improve productivity
and cut costs in the past two years.
In 2006 and 2007:
Purchasing costs were reduced by 9.1%,
excluding the impact of raw material
prices.
Productivity gains at the plants helped cut
manufacturing costs by 5.4%.
Logistics costs fell by 7.3%.
General and administrative expenses
declined 5% despite the development of
our international operations.
Distribution costs rose by 3.1%.
Investment costs were reduced by 35%,
enabling Renault to execute this period of
intensive development with no significant
increase in spending.
This policy will be pursued with the same
focus in 2008 and 2009.
For the first time since the launch of the
business plan, all regions reported a positive
operating margin. By reinforcing its international
management, for example with
the Regional Management Committees,
Renault increased the number of its profit
centers and reduced its dependency on the
European market.
6
Tune-up at the end of the Renault Logan assembly
line at the Avtoframos factory in Russia.
Paving tHe way for strong, sustainable growtH
Growth is Renault’s third commitment. The
first part of the business plan was devoted to
laying the groundwork for strong and sustainable
growth. Renault overhauled its product
line-up, developed new technologies and
expanded its geographical footprint.
Never before has Renault developed so many
new products, at such high quality levels and
during such a short period as in the past two
years. The number of new vehicles in development
doubled between 2005 and 2007. The
resulting rapid pace of product launches will
fuel growth thanks to a rejuvenated product
range that extends into new segments and
is better tailored to the requirements of all
customers, be they French, German, Brazilian,
Indian, Russian or Korean.
Alongside these products, we have developed
new technologies designed to reconcile
performance, safety and preservation of the
environment.
we thus added new engines to our powertrain
range, now benchmarks in their segments in
terms of fuel efficiency — the case of the
2.0-liter dCi, the 1.2-liter 100hp turbo and
the dCi 110hp, which enables New Laguna to
emit just 130g of carbon dioxide per kilometer.
Optimization of existing engines, means that
48% of Renault vehicles sold in Europe in
2007 emit less than 140 grams of carbon
dioxide per kilometer.
Lastly, Renault retained its leadership in safety
with nine cars awarded the maximum 5-star
rating in the Euro-NCAP tests.
The first half of the plan also saw Renault
expand existing operations in high-growth
markets, including Colombia, Russia, Turkey
and Romania, and enter new markets in India
and Iran. Between the end of 2005 and the
end of 2007, total production capacity, including
that installed at its partners, increased by
600,000 vehicles a year.
Thanks to two years of dedicated efforts,
Renault is well equipped to meet the challenges
of Renault Commitment 2009. There
has been a breakthrough in quality, our cost
structure is sound and we have laid the foundations
for future growth.
2007 Renault Annual Report