French automaker Renault decided to withdraw its electric vehicle business unit Ampere’s IPO (Initial Public Offering) on January 29, as per the press release.
Nonetheless, Renault still plans to launch seven new electric vehicle models to “democratize” the technology in Europe.
Ampere steps back from IPO plans
Renault Group initially announced plans to list Ampere on the stock market in 2022. At that time, the automaker targeted the first half of 2024 for the entity’s IPO with an expected valuation of up to €10 billion ($10.47 billion), depending on market conditions.
Unfortunately, Renault Group conceded that the current equity market conditions are not ideal to continue the IPO plans. This decision highlights the French automaker’s efforts to protect the interests of the company and its shareholders.
Despite the plan changes, Chief Executive Luca de Meo assured its investors and fans that the decision would not affect the automaker’s EV and software strategy.
Renault’s strategy
Renault committed to continuously fund Ampere until it hits break-even in 2025. For context, Ampere covers all of Renault’s electric vehicle-related businesses. It currently operates an EV plant in northern France with approximately 11,000 employees.
Renault aims to have Ampere reach over €10 billion in revenue by 2025 and €25 billion in 2031. It also seeks at least a 10% operating margin in 2030.
Apart from these, Renault will launch seven new models by 2031. The mix includes the electric Mégane E-Tech, Scenic, R5, and R4, the new low-cost Twingo, and two yet-to-be-named models.
“I’m extremely proud of our teams who created in less than 2 years the best answer to top global players competition with Ampere. By setting up a 100% focused EV and software business, we built in record time an agile and competitive entity. We have the start-up mindset which allows us to constantly innovate. This is exactly what will make Ampere successful in this new challenging environment.
Today, we took a pragmatic decision. We are all focused on executing our strategy and building our track record to create value for all our stakeholders.”
Luca de Meo, CEO of Renault Group & CEO of Ampere
The imminent launch of Renault’s seven new electric vehicle models is a significant part of its target to become an all-electric brand by 2030. However, the decision to cancel Ampere’s IPO may have an adverse effect on its growth as it would no longer have the chance to draw in Tesla-like valuations while they halt ICE sales in the following years.
