Forno Electric Vehicle Subsidiary IPO... "Targeting 10 Billion Euro Corporate Value"

Scheduled for Listing Early Next Year
"May Fail If Below 6 Billion Euros"

French automaker Renault has estimated the target valuation of its electric vehicle subsidiary, which is preparing for an initial public offering (IPO), at up to 10 billion euros (approximately 14 trillion won).

On the 15th (local time), Luca de Meo, Renault's Chief Executive Officer (CEO), stated that the company aims for a post-IPO valuation of 8 to 10 billion euros for its electric vehicle subsidiary, Ampere.

In February, Renault separated its internal combustion engine division and electric vehicle division, establishing the electric vehicle division as a separate entity and has been pursuing an IPO. The IPO is scheduled for early next year.

A source pointed out, "In a situation where the growth of the electric vehicle market is stagnating and price competition is intensifying due to low-price offensives by Chinese electric vehicle companies, the company is setting somewhat high targets (such as the desired offering price and offering size)." Another source said, "If the valuation falls below 6 to 7 billion euros, Renault may withdraw its IPO plan."

The market views Ampere's IPO success prospects more pessimistically. Swiss investment bank UBS predicted that reflecting the current market situation where investment sentiment toward the electric vehicle industry has significantly deteriorated, the valuation will likely be formed at around 3 to 4 billion euros.

Renault is focusing on mid-to-low-priced models to secure a competitive edge against Chinese electric vehicle manufacturers launching low-price offensives in the European market, and has set a goal to reduce production costs by about 40% by 2027.

Luca de Meo, CEO of Renault Group, is speaking at the earnings conference call last February.
[Image source=Reuters Yonhap News]

Renault entered electric vehicle development early in the early 2010s but was overlooked in the market, losing out to pure electric vehicle companies such as the American Tesla and Chinese BYD. Renault's electric vehicle sales this year decreased by 5% year-on-year as of the end of the third quarter.

Even in its home market, it is significantly lagging behind foreign brands. Renault's main electric vehicle model, the 'Megan,' sold 14,220 units in the French market from January to September this year, which is less than half of Tesla's 'Model Y' sales (29,291 units) during the same period.

Renault's electric vehicle models 'Zoe' and 'Twingo' have been discontinued or are about to be discontinued in the global market due to declining sales, and the launch schedules for the 'Scenic' and 'R5' have been postponed until after next year.

This content was produced with the assistance of AI translation services.