Renault : 2022-2023 integrated report

Daring & caring

Building the next-generation

automotive company

2 0 2 2 - 2 0 2 3 I N T E G R A T E D R E P O R T

Building a next-generationautomotive company takes more than innovation; it takes the right kind of innovation.

And for Renault Group, the right kind of innovation combines daring

and caring.

It also involves making a difference in technological, environmental and social terms.

Jean-Dominique Senard, Chairman of the Board of Renault Group, and Luca de Meo, CEO of Renault Group, share their views on the realities facing car manufacturers and explain why the next-generation automotive company will be the culmination of the transformation of Renault Group.

Governance08

The Board of Directors, which has embedded sustainable development at the centre of the Group's strategy, and the Leadership Team, with its enhanced agility and more cross- disciplinary approach, share their vision.

Strategy & key figures

11

Two years into the Renaulution, which kick-started the most spectacular recovery in the automotive industry, Renault Group is ready for its Revolution, the next step of its strategic plan.

Business model
& partnerships	15

The automotive industry has changed; it needs new paradigms to suit the new value chains and vehicle life cycles. Renault Group has therefore revamped its business model, combining its strength as a group with its agility as a multi-specialist. It champions a model of open innovation, bolstered by a full ecosystem of partners.

Sustainable development:
a strategy combining
daring and caring	18

The nature of this model means sustainable development always factors into strategic decisions. By engaging in dialogue with its stakeholders, particularly through its Purpose Committee, Renault Group is committing to harness the right kind of innovation, combining daring and caring to set no one aside - not our customers, our employees, the industry or the environment.

The new entities and their contribution to sustainable

development29

Each of the newly created entities will contribute, through its own business activities, to creating lasting value - rising to the challenge of global warming and resource scarcity, and providing safe and affordable mobility for all.

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Joint interview

Jean-Dominique Senard, Chairman of the Board of Renault Group, and Luca de Meo, CEO of Renault Group, share their views on the realities facing car manufacturers and explain why the next-generationautomotive company will be the culmination of the transformation of Renault Group.

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What are the main challenges that Renault Group faces today?

Jean-Dominique Senard: Our main challenge is to make Renault Group a future leader in sustainable mobility. It needs to be able to rise above the storms in the sector and create value, day after day, for all its stakeholders - our teams, our customers, our shareholders, our partners and society at large. And it

has to do all that in a tense geopolitical and economic context, amid deglobalisation and inflation, while taking on the challenge of industrial sovereignty.

It will take guts and a lot of heart; we want this transition to be guided by innovation that is fair and takes society and the environment into account. Our approach of daring and caring runs deep in our roots and is central to our company's Purpose.

We have extraordinary strengths that will enable us to deliver on our promise, "our spirit of innovation takes mobility further to bring people closer": our first-rate and dedicated teams, our effective governance, our strong strategic plan and a rebooted Alliance standing on the firmest of foundations.

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Luca de Meo: The transformation unfolding before our eyes in the automotive sector is like nothing we have ever seen before. The question we have to answer is what business model will work for a car manufacturer in this new world; that is our first challenge. Until recently, things were quite simple: there was one value chain - internal combustion and hybrid engines. It's as though we spent

125 years solely focusing on a single sport. But now new value chains are sprouting up, like new branches growing from a trunk: electric motors, software, new forms of mobility and the circular economy. So we are suddenly learning all these new sports. The drills are different, the rules are different and the skills we need are different. The types of team we need are different, too; we no longer need huge, vaguely defined teams where everyone can do pretty much everything - we need compact teams that focus fully on one sport in particular.

The second big challenge is related to the technological landscape.

For over 100 years, we worked in an industry of mature technology and ever-increasing demand, and where what mattered most was scale and efficiency. But we are now stepping into a shifting and volatile landscape. Technology is blazing so many trails at once, and manufacturers need to keep an eye on all of them at the same time. They also have to be ready to move very fast, ready to get out if one trail hits a wall and jump in elsewhere if another opens up. What matters most nowadays is an agile strategy and the ability to innovate at every level in the company

• and that is another aspect we have to integrate.

We want this transition to be guided

by innovation that is fair and takes society and the environment into account.

Our approach of daring and caring runs deep in our roots and is central to our company's Purpose.

Jean-Dominique Senard

How are you going to tackle these challenges?

How does the rebooted Alliance fit into Renault Group's new strategic framework?

Luca de Meo: If we navigate these twists and turns properly, the headlong transformation in our sector will be a once-in-a-lifetime opportunity to move back into the lead. To pull that off, we have to transform the company to adapt to the reality in its new playing field. That is what we mean by building the next-generation automotive company: a company that can excel at the sport it has been playing for over a century, as well as the new ones. This is why we are setting up four teams to focus on these new disciplines full time: Ampere for electric vehicles and software; Alpine for premium cars;

Horse is a good example of our horizontal approach. We are combining our strengths and expertise with Geely and Aramco, and looking beyond the traditional logic of efficiency and scale. The next-generation company is an open one; the idea is not to try to do everything ourselves, nor outsource everything to suppliers. We aim to identify the best partners and work together to develop the best solutions with them.

This approach enables us to share risks and investments and operate everywhere at once, throughout the whole value chain, but in an intelligent

Jean-Dominique Senard: In the almost 25 years since its inception, the Alliance has accomplished a great deal and emerged as a singular model for three large companies - Renault, Nissan and Mitsubishi Motors - to work together with the utmost respect for each other's identity.

The crises of recent years, however, had challenged our most important asset: trust. We have patiently rebuilt the Alliance, one key step at a time, with new governance and a new way of working, as well as by refocusing on concrete projects. As announced on 6 February, we have rebalanced the Alliance, given it fresh momentum and added flexibility. Each company can now start

up new large-scale projects and develop fresh business opportunities - like the ones we will start working on together in Latin America, India and Europe.

The Alliance, which is also an ecosystem, dovetails very naturally with the more horizontal approach in the next-generation company we are building.

The headlong transformation in our sector will be a once-in-a-lifetime opportunity to move back into the lead.

The automotive industry is facing high expectations on the environmental front. How is Renault Group factoring the need to reduce its impact into its business?

Luca de Meo

Luca de Meo: The overarching goal is sustainable mobility. The challenge is mapping out the journey to get there - and keeping mobility affordable.

and hybrid models and will transition to electric vehicles later on, using its usual approach - and harnessing technologies that Ampere will have

Mobilize for new forms of mobility; and The Future Is NEUTRAL for the circular economy. And, of course, we mustn't forget our traditional trade - which is why we also set up Horse, a leading supplier of internal combustion and hybrid powertrains.

way. It also gives us the ability to change direction whenever we need to and

to team up our people with the most pioneering players.

The next-generation automotive company that we are building is geared for this journey. With Ampere, we are making a decisive move into electric mobility, particularly in Europe. And with Horse, we are addressing the fact that many parts of the world will take longer to gravitate to electric vehicles, so we need to continue to invest in low-emissioninternal-combustion technologies while improving their performance.

Dacia will be another important player in this transition; it sells affordable internal combustion

amortised by then. Mobilize, which is working on new forms of mobility, aims to find solutions that use energy and other resources more intelligently. And The Future Is NEUTRAL, our circular economy business, is aiming for €2.3 billion in revenue and double-digit margins by 2030. Transforming our plant in Flins into one of Europe's top circular economy complexes is more than a symbolic move - it is our way of placing the journey to sustainable mobility at the centre of our business.

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