Renault 2008 Finacial Results Down, 2009 Prospects Worse

Renault's financial performance in 2008 was, as expected due to the economic mayhem that ravages the automotive industry, very poor. The French company posted a total revenue figure for 2008 of 3,791 million euros, down 7 percent over the year. The final quarter of last year alone registered a record 28.7 plunge, while exchange rate movements were responsible for 2.5 points of the full-year decline.

Renault tried and still tries to stop the onslaught of the financial decline through any means it can. The company reduced production twice as fast as sales in the fourth quarter, making it possible to reduce inventory to €5.3 billion, beating the target, which had been to get back to end-December 2007 levels by the end of 2008.

Renault's voluntary workforce adjustment plan made some 1,700 employees leave the company and another 5,300 to apply for the jobcuts. A further 1,100 job cuts will be achieved from the European subsidiaries, mainly through natural attrition.

“A financial and economic crisis of massive proportions hit the global economy in 2008. Beginning in July, Renault implemented a special action plan that included working down inventory and cutting costs and investments to adjust swiftly to the new market conditions. The Group will step up these measures in 2009 to improve free cash flow.”

The French Government is trying to lend a hand to the domestic automotive industry by supplying both Renault and PSA Peugeot Citroen with state funding. If they are to take the money, the two producers must stop closing plants, cutting jobs and outsourcing operations.
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About the author: Daniel Patrascu
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Daniel loves writing (or so he claims), and he uses this skill to offer readers a "behind the scenes" look at the automotive industry. He also enjoys talking about space exploration and robots, because in his view the only way forward for humanity is away from this planet, in metal bodies.
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