French earnings call, October 2026: Renault confirms around 5.5% operating margin target

Renault Group said its margin is tracking in the bottom half of its range

Renault Group held its call for the third quarter of fiscal year 2026 on 29 October 2026. The chief financial officer gave the statements below.

• Renault Group measures operating margin as a percentage of group revenue. The chief financial officer said the guidance of around 5.5% sits within a 5.3%-5.7% range, with performance tracking in the bottom half of the range.
• Renault expects operating margin in the second half of fiscal year 2026 to improve slightly versus the first half.
• The chief financial officer said the seasonal uplift is expected to be less pronounced than in previous years, due to higher raw material costs and inflation.

Renault Group said raw-material and inflation costs match its EUR 600 million estimate

• The chief financial officer said the fiscal year 2026 impact of raw-material and input costs remains in line with the EUR 600 million estimate. This comprises EUR 200 million in the first half and EUR 400 million in the second half. EUR stands for euros.
• Renault Group's variable-cost reduction guidance is over EUR 400 per unit. The chief financial officer said the strong dynamic is expected to continue.
• Renault expects total inventories at year-end 2026 to trend toward the lower end of its 525,000–550,000-unit range.

Renault Group said electric vehicles will reduce margins in the short term

• The chief financial officer said electric vehicles (EVs) will remain dilutive in the short term, meaning they lower the margin. Renault expects that effect to reverse over time as costs decline and new platforms are introduced.
• The chief financial officer said Renault is quite comfortable that it can meet EV demand without issues through the end of fiscal year 2026.
• The chief financial officer said the Alpine A390 had nearly 2,000 registrations, below Alpine's volume ambition, but was progressively establishing a second pillar for Alpine's electric growth.

Renault Group gave limited answers on 2027 costs and policy

Analysts asked about the expected impact of material costs in 2027, and management declined to answer. Management gave a partial answer on what is offsetting lower second-half volumes. It deflected a question on what the Made in Europe and carbon dioxide (CO2) policy changes mean for Renault in 2027 or 2028.