French car giant Renault fell to a record loss of €7.4bn (£6.8bn) in the first half of 2020 as the coronavirus pandemic decimated the global automotive industry.
The firm said that most of the loss came through its creaking alliance with Japanese automaker Nissan, which filed a €4.8bn loss.
Speaking to investors today, new chief executive Luca de Meo said that both firms had been handed a “wake-up call” by the dreadful performance.
“We are currently touching the bottom of a negative curve that started several years ago, and probably even earlier”, he added.
Over the last few years the once-profitable alliance between Nissan and Renault has come under increasing strain, with scandal surrounding ousted Nissan chief Carlos Ghosn adding to slipping margins.
However, he assured investors that he was still confident in the future of the alliance, to which both firms again expressed their commitment earlier this year.
“With these results, the first priority is for both companies to focus and fix their miseries internally”, de Meo said.
“I think we are finding, let’s say, a good setup and we are trying to focus on four or five key projects where we can really prove to each that by working together it’s going to bring a benefit.
“We will see in the next months and years the result of that very operational and pragmatic work. I am confident we can give a lot to one another.”
With factories and showrooms shuttered for several months in March after lockdown restrictions kicked in, Renault’s sales fell 34.9 per cent to 1.3m.
That is behind the worldwide market, which saw sales plunge 28.3 per cent on average over the same period.
First half revenue fell 34.2 per cent to €18.4bn, while the firm record a negative operating margin of €1.8bn.
Renault managed to increase its liquidity by €6.5bn in the period, largely thanks to a €5bn loan that has been guaranteed by the French state. That takes its total liquidity to €16.8bn.
Despite the dramatic plunge, de Meo insisted he was confident that the firm could recover.
“Although the situation is unprecedented, it is not final. I have every confidence in the Group’s ability to recover.”