Renault Leadership Vacuum, A Short-Term Headwind That Could Prove Challenging Long Term

Summary

• Renault's financial performance and growth prospects have deteriorated, with revenue and net income well below previous highs and R&D spending under pressure.
• Leadership changes, unwinding of the Nissan alliance, and intensifying Chinese competition threaten Renault's position as the last independent French mass-market automaker.
• Recent collaborations with Geely offer a potential safety net, but are not enough to offset existential risks and industry disruption facing Renault.
• I rate Renault a Sell due to its weak financials and high industry risk. Investors have better options among consistently growing companies.

Neme Jimenez

My, how Renault SA’s (OTCPK:RNSDF) prospects have taken a turn for the worse over the past quarter-century. In 1999, when the French automaker rode courageously to the rescue of debt laden Nissan (OTCPK:NSANY), the two automakers – joined by

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