Automotive News Europe - March 2, 2009 - 2

PAGE 2 · www.autonewseurope.com March 2, 2009 Automotive News Europe Inside this issue Miura and me 8 Veteran Italian car designer Marcello Gandini explains why he, and he alone, is the man behind an all-time design classic Gandini created an automotive icon Hot-selling Logan can’t rescue Renault To rebound, automaker also needs help from Megane line and LCVs Lawrence J. Speer Automotive News Europe PARIS Renault expects its low-cost Logan range to continue growing in 2009, despite the global slowdown. Executives at the French carmaker admit, however, that strong performance from the five-vehicle Logan family will not be enough to pull Renault toward profitability in 2009. “Logan can’t save Renault, and it’s not in our ambitions, but we can do our part so the company does better,” Gerard Detourbet, director of Renault’s entry program, told Automotive News Europe. All talk 13 Car-to-car and car-to-infrastructure communications will provide safety and other benefits to tomorrow’s motorists Soon cars will be able to communicate better Back to basics 14 Head of Italy’s coachbuilders association says traditional Italian design is needed now more than ever 3 pillars of profitability CEO Carlos Ghosn says the Logan range produced by Romanian subsidiary Dacia is one of the three “pillars of profitability” that Renault will depend on to get through the crisis. The other pillars are cars built on the recently renewed lower-medium Megane platform and the light commercial vehicle range. These must also perform up to expectations for Renault to survive, Ghosn said last month while presenting the company’s 2008 financial results. “The Logan range is moving along nicely, but we can’t make any projections for 2009,” Ghosn said. “It will depend on what happens in the market.” Logan sales grew 38.7 percent in 2008, to just over 509,000 cars. The low-cost family of cars represented Renault may add the Brazil-only Sandero Stepway to the low-cost Logan range it sells in Europe. Logans represented about 21% of Renault’s 2.38 million sales worldwide in 2008. about 21 percent of Renault’s 2.38 million sales worldwide. Logan also helped the carmaker boost its non-European sales to a record 37 percent of total volume. Chief Operating Officer Patrick Pelata described the Logan program as “an island of serenity in the midst of the storm,” noting that profit margins for Logan-based cars were still hovering near a previously announced 6 percent level. Demand is declining in markets hit hard by the credit crisis, like Brazil, Romania and Russia. Despite the slowdown in Russia, Renault is speeding up plans to double production capacity by year-end to 200,000 units at its plant in Moscow. The French carmaker is also considering expanding its Logan line by importing to Europe a Brazilian-designed SUV-like variant of the Sandero hatchback, which is called the Sandero Stepway. The car has been a success since its 2008 launch in South America. The slowdown of Logan sales in some emerging markets is countered by performance in mature markets like France and Germany, where new scrapping incentives for older cars are helping the car. Orders are out-pacing supply from the car’s main assembly plant site in Pitesti, Romania, which temporarily closed in late 2008 as Renault sought to curb inventory. Now, Renault is trying to improve output-per-hour in Romania by having employees work Saturdays. “If we would have known about the incentive system, we would not have cut production,” Pelata said. Crisis control Factors expected to boost Logan sales in 2009 Scrapping incentives across Europe are boosting sales of low-cost cars Low-cost car sales less affected by global sales slowdown Sandero hatchback still in first year of sales New alternative-fuel range qualifies car for CO2 tax breaks in Europe Renault has frozen plans to manufacture the next generation Logans in a new factory being built by alliance partner Nissan in Chennai, India. Renault also has slowed plans to build next-generation Logans at a second factory under construction in Morocco. Detourbet says the crisis has not slowed his long-term goals for the low-cost range. The Logan family will continue growing in emerging markets, expanding the presence of the Renault brand and setting the stage for the introduction of its other vehicles. “We’ll be a good student this year,” he said. “But it takes other good students to ANE make a class.” Fioravanti sees better days for coachbuilders I know you got Soul 22 Kia introduces a crossover vehicle to appeal to the MTV generation The Soul from Seoul Correction The cost of Inchcape’s restructuring will be £85 million (about ¤95 million). The restructuring will save £55 million annually. A story on Page 2 of the February 16 issue misstated the figures. Good news, bad news To boost the Logan’s global production further, a new South African manufacturing facility started making cars in late-2008. The first low-cost Sandero units stamped “Made in South Africa” go on sale in March. The African venture is Renault’s eighth Logan production site, alongside factories in Brazil, Columbia, India, Iran, Morocco, Romania and Russia. Company Index These companies appear in stories in this issue of Automotive News Europe Aston Martin . . . . . . . . . . . . . . .15 Audi . . . . . . . . . . . . . . . . . . .15, 29 Bentley . . . . . . . . . . . . . . . .11, 15 Bertone . . . . . . . . . . . . . . . . . . . .8 BMW . . . . . . . . . . . . .1, 15, 25, 29 Chevrolet . . . . . . . . . . . . . . . . . .15 Chrysler . . . . . . . . . . . . . . . . . . .27 Citroen . . . . . . . . . . . . . . . . . . . .16 Continental . . . . . . . . . . . . . .5, 12 Daimler . . . . . . . . . . . .1, 7, 16, 23 Fiat . . . . . . . . . . . . . . . . . . . . . . .16 Fioravanti . . . . . . . . . . . . . . . . .14 Ford . . . . . . . . . . . . . . . . . . .16, 23 General Motors . . . . . . . . . .4, 17 GKN . . . . . . . . . . . . . . . . . . . . . .28 Hyundai . . . . . . . . . . . . . . . . . . .16 Infiniti . . . . . . . . . . . . . . . . . . . .16 Italdesign Giugiaro . . . . . . .8, 15 Jaguar Land Rover . . . . . . . . . .27 Kia . . . . . . . . . . . . . . . . . . . .17, 21 Lagonda . . . . . . . . . . . . . . . . . . .17 Lamborghini . . . . . . . . . . . . . . . .8 Mazda . . . . . . . . . . . . . . . . . . . . .17 Mini . . . . . . . . . . . . . . . . . . . . . . .28 Mitsubishi . . . . . . . . . . . . . . . . .17 Nissan . . . . . . . . . . .1, 10, 17, 23 Opel . . . . . . . . . . . . . . . . .4, 17, 26 PSA . . . . . . . . . . . . . . . . . . . . .5, 18 Renault . . . . . . . .1, 2, 10, 17, 31 Rinspeed . . . . . . . . . . . . . . . . . .18 Robert Bosch . . . . . . . . . . . . . .12 Rolf Group . . . . . . . . . . . . . . . . .23 Rolls-Royce . . . . . . . . . . . . .17, 19 Saab . . . . . . . . . . . . . . . . .4, 18, 19 Schaeffler Group . . . . . . . . .5, 31 Seat . . . . . . . . . . . . . . . .18, 20, 21 Skoda . . . . . . . . . . . . . . . . . . . . .18 Toyota . . . . . . . . . . . . . . . . . . . .18 Volkswagen . . . . . . . . . .1, 11, 18 Volvo . . . . . . . . . . . . . . . . . . . . .19 Subscription per year: Europe: €109 Outside Europe: $189 Customer Service Europe and all other countries: “We’ll be a good student this year, but it takes other good students to make a class.” Gerard Detourbet, Renault’s entry program head Has the Renault-Nissan alliance stagnated? From Page 1 “What puzzles us is how they are going to find such a high level of new synergies, when they haven’t been able to do it until now,” said Emmanuel Bulle, analyst with Fitch Ratings. Platforms offer a major example of missed opportunities. Until now, the Japanese and French carmakers have had little success sharing platforms, outside the small car architecture used by Nissan’s Micra and Renault’s Clio and Modus models. But Nissan is now developing a smaller platform for a planned Micra redesign that Renault has no immediate plans to use. Meanwhile, Renault is focusing on its hit Logan car in the entry-level segment. That platform, analysts said, would have been the logical choice for Nissan’s low-cost Livina for emerging markets. But Nissan went its own way. “The alliance has stagnated,” said Kurt Sanger, a Tokyobased auto analyst at Deutsche Securities. “The business model was to get high volumes and high profits quickly, and that’s not going to happen, at least for now.” Paris-based engineering and quality operations. During Desforges’ leadership of the Renault Nissan Purchasing Organization, joint purchasing activity rose from 30 percent of total volume in 2001 to 85 percent in 2007, according to Credit Suisse calculations. That represented $7.9 billion (¤6.2 billion) in savings. Moving Desforges to the engineering and quality post shows a commitment to sharing platforms, future products and technologies with Nissan, sources said. Analysts say Renault and Nissan will only make the most of potential synergies when greater numbers of components are used on vehicles built with shared platforms. “We don’t doubt there is room for more savings via further platform and powertrain sharing and complexity reduction,” said Credit Suisse analyst Stuart Pearson. “But, these savings take time to deliver, and realistically Renault needs to navigate through this crisis before it is likely to see the benefits of any renewed efforts in this area.” Pelata accepts that more must be done, but says the best is yet to come. “We already have 10 years experience of corporate life with Nissan, full of ups and downs, mistakes and big successes. Now the time has come to accelerate.” Reuters contributed Vol. 14 No. 5. Automotive News Europe is published bi-weekly by Crain Communications GmbH, Argelsrieder Feld 13, 82234 Oberpfaffenhofen, Germany. Periodicals postage paid at Detroit, MI. 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Automotive News Europe - March 2, 2009

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