Renault S.A.

Good morning, everyone, and welcome for our '24 results. We are very pleased to be here with the team.

And the presentation will be made by Luca de Meo, CEO of Renault Group; and Thierry Pieton, CFO of Renault Group. And this presentation will be followed by a Q&A session.

Luca, the floor is yours.

Hello, everyone. Good morning.

So, thank you for joining this call. Things are pretty rock and roll in automotive these days.

So, it takes a lot of focus even at 8:00 am in the morning. A lot of discipline, hard work.

And I think also a touch of passion that is mandatory to spark innovation and to continuously adapt to a changing environment. We will be here to present to you third year in a row record results for Renault Group.

I think I can say probably we found our magic potion like in Asterix and Obelix. I don't know who is Obelix and Asterix, Thierry.

You look more like Panoramix. So, jokes apart, we will deliver -- in 2024, we delivered 7.6% of operating margin.

This is actually EUR 4.3 billion, and this is our biggest operating margin in 126 years of history of the company. And we generated almost EUR 3 billion of free cash flow, achieving then as a consequence, over EUR 7 billion of automotive net cash position.

This is also all-time record. So, actually, we do more than just breaking our own records.

I think we are a pretty reliable bunch of people. We're the only ones that achieved our initial guidance.

We are pretty proud of it because there was a lot of work actually with the exception of Ferrari. We are together with Ferrari.

So, it's a good opportunity to say hello to my friend,?Benedetto, and congratulate him. Most importantly, I think we confirmed our ability to generate cash that shows that we are in a very solid position to invest in our future.

EUR 2.9 billion in 2024, actually it took us one decade to generate the same amount of money between 2011 and 2020. So, I think that in automotive, the most important thing, the first thing is product.

So right from the beginning, as you remember, we put the whole product conversation at the core of everything we do. And we're starting to get -- to take full advantage from having restructured our brand portfolio with 4 strong brands on a very -- and very, very clearly differentiated territories.

And I think also with a complementary offer. Renault is a kind of pop and modern brand focused on innovation and electrification that just serves the main consumer needs and offers the best value for money in the market.

Alpine, I think, gives us for the first time, in the history of Renault, the opportunity to attract affluent customers and car enthusiasts with electric platforms of a new generation and we know with the top-notch racing technology. And then Mobilize, is a specialist, of course, of financial services, but also energy and also new mobility, and we also start to do design purpose vehicle from some segments of the mobility.

So, all this work to reposition our brands, as I was anticipating, has already paid off. We put the Renault brand back where it belongs, up from position #5 to position #3 in Europe, where it's now one of the 3 brands with over 1 million sales per year.

It's a leader on LCV segment, and it's #1 in France in all rankings, passenger cars, vans, retail, fleet, EV, you name it. Dacia is #3 on the retail market in Europe and is now one of the top 10 brands for passenger cars in Europe.

Alpine is celebrating this year this 70th anniversary, but it's -- I think it's younger than ever. We have reignited it.

When we measure the brand value, that is one of the KPIs that we track, the value is now at EUR 840 million. This is 6x what it used to be just 3 or 4 years ago.

We multiplied the sales of Alpine by 3 since 2020. And we only had one car, this is the A110, which is a product that at the end of the life cycle.

So, I think the -- on Alpine, the best is still to come. And all of this, in my opinion, is kind of a very solid bedrock on which we have set our lineup.

We have launched 22 products in 3 years. And I think 2024 was a firework.

We launched 10 cars on time without any quality problem, something that this company had never ever achieved before. So, it's also a sign of the fact that the system is organized and healthy and capable.

It was a stress test for sure, for Renault Group, launching 10 cars in a year without any delay in the year where also regulation was changing with the GSR2. So, when I tell you that this is the best lineup Renault had in 3 decades, just ask the expert what they are saying.

And it's clear that we have -- we won prices everywhere. The most important one was the Car of the Year award, which is kind of a holy grail for cars in Europe that was given to the Renault 5 and also to the Alpine 290.

Last year, maybe you remember, we won with Scenic. And this is a kind of historical doublet, something with actually no precedent for us or for the French automotive industry.

The last time a company won 2 years in a row was Fiat in the '90s, maybe the Italian touch on the thing, I don't know. On top of it, you had Dacia that was ranked #5 in the Car of the Year.

So, we actually had 3 cars out of 7 finalists in the context. And by the way, I don't want to forget that New Master is also Van of the Year 2025.

So, this is not the kind of thing that happened by accident, it means that we focused on that, the result of a very strange work from the Renault Group team that we have done in the last 4 years. And I think it's the best evidence that this company has moved to a new standard, which is important.

And I think we are now ready to take advantage of an unprecedented product life cycle. So, we now have the right cars, but I think we also have the right strategy, a strategy that is designed to give us agility and flexibility in a world that is becoming more and more volatile.

So, we actually knew from the start that the energy transition, for example, will be a bumpy road. We have designed Renault Group to be ready to smartly adapt to the changing pace of markets and technology absorbing all the up and downs.

We are all set for the journey, thanks to clear assets. This is not PowerPoint.

This is organization, people, processes to play with the smooth transition. You have on one side, Ampere, which is our EV and software champion.

It's an organization that is tailored to outpace the EV pure players in the race towards EV-ICE price parity. And then on the other side, you have Power and Horse, which is generating cash, is derisking the group and racing to reinvent the ICE and hybrid technology.

So that way, if you want -- it looks like, if I can use an image, we are sure we can run to solid legs. With the future Twingo, just to get a little bit more in detail, Ampere, I think, is already demonstrating its effectiveness to boost EV democratization in Europe.

We reduce development time. We leverage the global competitiveness of supplier system and in particularly the China ecosystem.

We push the envelope in terms of battery technology, we'll see. So, we have combined many ingredients to come up with, I think, the right receipt.

And on top, as you can see, it doesn't prevent us from offering a super attractive car with an outstanding design. When it comes to development time, which I mentioned before, a few years ago, 2 years would have looked unbelievable.

It took us between, I would say, 4, 5, 6 years to develop a car. Today, we are making it.

So, we stay true to our ecosystemic approach. We partner with the best.

We learn from them. And that's what we did by setting up the -- the reason why we've been setting up the Shanghai Ampere China Development Center, to put Renault directly into the most vibrant engineering ecosystem globally.

I think the Twingo also showcases Ampere's ability to deliver best-in-class efficiency. The car will consume 10 kilowatts of electricity per 100 kilometers, which is a benchmark.

Ampere has also achieved a battery plan to get LFP technology to our cars, not only the Twingo, by the way, in just 18 months. It shows the strategic agility and operational agility and the ability to pivot fast that Ampere is bringing to the group.

For your information, Twingo variable costs will be 40% lower than those of the Renault 5. We will, of course, transfer this experience to other products, including Renault 5 and Renault 4, and with all of that, we set the condition allowing us to make a small EV in Europe in a very, very competitive way.

So, we also dramatically reduced diversity and complexity. In 2019, our cars had 2,200 parts between 2,200 to 2,600 parts on average.

The new Twingo will have around 750, and it's actually compared to the Renault 5, it's a reduction of 30%. So, it's a completely different way of designing the cars.

And we push for the systematic reuse of on-the-shelf or off-cycle parts. So, before the Renaulution, our carry across never exceeded 50%.

And now we achieved up to 80%. And the bottom line is a price that will be below EUR 20,000 without subsidies.

So, this is less than EUR 100. So, the car is going to be my opinion, a game changer like Twingo was 30 years ago.

And this is the kind of fit-for-purpose urban vehicle state-of-the-art EV with no compromise over its entire life cycle. The future Twingo will emit 75% less CO2 than the average car sold in Europe in 2023.

And of course, with 0 tailpipe CO2 emission, it will also, by the way, occupy 20% less space than the average European cars in very busy European cities. So, I think this is a strong, clever, inclusive counterproposal of the European industry to the challenges of sustainable mobility.

And actually, the story of the Twing is much bigger than just one breakthrough product. With Twingo, we take the opportunity to set a new standard for Renault with a program that we call LEAP 100.

And from now on, that means that we target to make all our cars in 100 weeks. So, it's less than 2 years.

Actually, the Twingo will be done in 21 months. So, I think we've just moved to Chinese speed, thanks especially to the people of Ampere.

And as the news of the day, we are even preparing to go one step further in terms of EV affordability. In fact, back in the kitchen, Dacia and Denis there is preparing with Ampere and ACDC, a new A-segment EV made in Europe and we'll develop it in 16 months.

I repeat 16 months. So, 21 months for the Twingo, it would be already pretty fast, but 16 months, I defy any competitor in the world to do that, including the Chinese when they come to Europe.

So moreover, it's a true Dacia, always the best value for money. So, we're planning to sell the car below EUR 18,000, of course, making money the way Dacia is used to.

We are moving fast on the EV side, but we're not slowing down on the ICE side either. Renault Group is, I think, strongly positioned as the #2 OEM in Europe for hybrid vehicles just 4 years after we launched for the first time the E-TECH technology.

So, with an HEV market share that rose from 2% to 20% since 2020. So, we make 20% of the hybrid market in Europe.

And I think with the best-in-class carbon footprint because the E-TECH of Renault is between 10 to 20 grams below our direct competitor for the C-segment product category. It's now pretty obvious, I think, that our leadership position on hybrid technology is, I think, a great asset to absorb the shocks on the EV market while continuing to lower average emissions.

We know that the race to decarbonization will be uneven across markets and geographies. That's why we put ourselves in the position to reinvent the ICE technology with ultra-low emission solutions working on, for example, synthetic fuels or hydrogen or biofuels.

That's what is all about Oroch. Oroch is our champion when it comes to supplying powertrains.

So, by joining forces with Geely and Aramco also with sales of more than EUR 15 billion in 130 countries and 5 R&D centers. I think we're gaining productivity, you can already see that.

We reduce our fixed costs, obviously, because they are deconsolidated and we have the right scale and expertise to build the future of ICE. And we significantly improve, I think, our balance sheet and keep a substantial stake in a growing and cash-generating business.

For your information, Oroch signed up to 5 new customers in the last 6 months with products that are innovative and for some of them outside the automotive space. So, the story is actually just starting.

And so, my conclusion is that probably no other OEM can pretend today to be so flexible as Renault Group to cope with what comes next, whatever it might be. On top of that, you can also count on us to push the envelope on excellence and look for performance improvement in the wake of what we have already demonstrated over the past years.

For example, our value over volume policy is, I think, embodied or materialized by our exposure to retail channel mix. We have achieved to positioned ourselves more than 20 points above the market average.

So, we have set our target of being around order book and 2 months inventories. We are within our sweet spot in terms of residual value.

In just 4 years, we have gained almost 10 points. So, we are now between plus 4 to plus 12 points above the others in Europe in terms of residual value.

We have also done the job to rightsizing our industrial capacity, achieving around a 90% utilization rate of our plants. So, we've done the job in the past 4, 5 years to put Renault back at its best level ever, and we are now ready to go much further and faster.

So, I will tell you more about in a few minutes, but before that, it's time to hear our beloved CFO, going into more detail on the financial results. Thierry?

Thanks very much, Luca. Good morning, everyone.

It's a pleasure, as usual, to be here to present our 2024 full-year results, which, as Luca already mentioned, display record levels of operating profit and a record net cash position. So going straight into the group revenue.

Renault Group enjoyed a 7.4% revenue growth at EUR 56.2 billion in 2024. As you will see, this result has been achieved while, as Luca said, staying true to our value over volume credo.

At a constant exchange rate, revenue was up 9%. Automotive revenue stood at EUR 50.5 billion, up 4.9%.

At constant FX, it increased by 6.3 points. The mobility services contribution amounted to EUR 69 million, up EUR 24 million, and Mobilize Financial Services revenue increased by 35% to EUR 5.6 billion, mainly driven by higher interest rates and by the increase in average ticket per vehicle.

Let's drill down in the automotive revenue. It included 1.4 points of negative exchange rates, mainly related to the Argentinian peso and the Turkish lira devaluations, and to a lesser extent, to the Brazilian real.

Volume effect was positive at 1.3 points, in line with the increase of our registrations, which were up 1.3% worldwide. Let's have a look at our sales performance.

In 2024, registrations continued to grow for the third consecutive year to reach 2.3 million units at group level. Each of our 3 brands, Renault, Dacia and Alpine contributed to this growth, reflecting the growing success of our product defensive.

In 2024, new launches represented 14% of our invoices. This share grew steadily from, if you recall, 5% in the first half to 18% in Q3, it represented 25% of our invoices in Q4, and this trend is going to continue in the coming quarters.

In Europe, Renault Group consolidated its third position, progressing twice as fast as the market with sales up 3.5%. Renault brands remained the best-selling French car brand in the world and continued its progression with global sales up 1.8%.

In Europe, the brand grew by 3.3%, also twice as fast as the market, breaking the 1 million mark. Renault brand ranked #3 in passenger cars and light commercial vehicles.

Renault was also a leader in the light commercial van segment, thanks to the success of its flagship vehicles, Cango and Traffic, and in a year of transition with the launch of New Master. Overseas, Renault started to roll out the product defensive of its international game plan.

In South Korea, the launch of Grand Koleos last September drove an impressive 80% growth. The SUV is currently being launched in the Gulf countries and in Latin America.

Sales in Brazil rose by 10%, supported by the launch of Kardian. The model was also subsequently deployed in other Latin American markets and also in Morocco in December.

Kardian was elected Car of the Year, both in Brazil and in Argentina. This international offensive has been reinforced with the launch of Renault Duster in Turkey in H2.

Duster will complete its geographic expansion in 2025 in Ukraine, Egypt, South Africa, Australia and in the Gulf. Dacia sales were up 2.7%.

Dacia was in the top 10 best-selling brands in Europe, as Luca said, with a record-breaking market share. It also confirmed its place on the podium of passenger car retail market, thanks to a very high new customer conquest and loyalty rates.

On top of having Sandero as the best model in Europe across all channels, Sandero and Duster were respectively, first and second best-selling vehicles to retail customers in Europe. Bigster, the future C-segment SUV, will complete the line-up in the first half of 2025.

Alpine also continued its progression with more than 4,500 units sold even before its product offensive really started as the A290 only hit the showrooms very recently. First car of the Dream Garage, the A290 inaugurates Alpine's 100% electric line-up, which will be strengthened this year with the A390.

Overall, our brands have continued to grow, but always with a strong focus on value and sales quality as illustrated by these 3 KPIs. First, the retail channel represented more than 63% of passenger car group sales, almost 21 points above the European market average.

Second, Renault brand pursued its conquest of the C and above segments in our 5 main European countries. They represented 41% of the brand's European sales, up 15 points in 4 years, driven by Rafale, Espace, Scenic, Symbioz, in addition to Arkana and Austral.

Third, top of the range versions continue to represent a significant share of our mix. Finally, let's have a look at our electrification offensive.

In 2024, nearly 33% of our European group passenger car sales were electrified, an increase of 4.1 points versus 2023. HEV sales increased by 47% in '24 accounting for almost 24% of group sales, up 7.1 points versus 2023.

Renault brand strengthened its second place on hybrid in Europe with a 16% market share. Dacia is also further electrifying its range by expanding its hybrid offerings initially introduced on Jogger, the hybrid version is now available on Duster.

Furthermore, Bigster will feature the Hybrid 155 engine, making it the first Renault Group model to benefit from this new powertrain. Full electric vehicles accounted for almost 9% of group sales in Europe in a year of transition in terms of product plan.

The EV offensive started to be reflected in our Q4 mix, during which EVs amounted to more than 12% of sales at group level, almost 5 points more than the rest of the year. 13% of Renault Brands' European sales were fully electric, rising above 16% in Q4.

At the end of 2024, EVs represented 19% of Renault brand's order book. Commercialized since the end of 2024 in France and elected Car of the Year in '25, Renault 5 made a strong start in its first countries of sale and was already the best-selling EV in France for January.

In 2025, Renault will continue its electrification offensive with the commercial launch of Renault 4 and the introduction of Renault 5 in its various markets, reinforced by a new version with the 40-kilowatt battery. Switching gears to inventories.

We had a higher restocking within the dealership network in '24 compared to '23, in line with our expectations and to support our ongoing product offensive. At the end of 2024, total inventories of new vehicles stood at 450,000 cars, of which 437,000 at independent dealers and 103,000 at group level.

New products represent more than 24% of this amount. Overall, we continue to monitor carefully our inventories and are very comfortable with the current level given the launch activity and given the order book, which remains very healthy at 2 months of forward sales.

Sales to partners effect was negative 0.9 points. As anticipated, new vehicle sales to partners decreased in the transition year before the launch of the new products.

This will start with new Micra for Nissan this year. R&D billings to partners offset part of the decrease, especially in H1.

The 0.6 points of price effect was mostly related to the offset of currency devaluations, mainly in Argentina and Turkey. As said in H1, we have entered a phase of price stabilization and we are passing a portion of our cost-savings to our customers, primarily through enhanced content.

And we'll talk more about this when we talk about the margins later on. The positive product mix effect of 2.7 points was in constant improvement over the year with all group's recent launches and stood at 4.1 points in the last quarter.

Product mix will continue to be a strong positive driver in the next quarters. Geographic mix impacted positively for 0.4 points.

And to conclude on our revenue bridge, the other bucket posted a positive 2.2 points, mainly thanks to the strong activity of parts and accessories as well as used car sales. Now let's switch to the operating margin analysis.

Once again, this year, we posted a record operating profit in absolute value, delivering EUR 4.3 billion. It represented 7.6% of revenue and more than 3.5x 2021 group operating margin.

Adjusted from the impacts of Horse on a like-for-like basis, group operating margin was up 15% and 50 basis points versus 2023. The automotive segment's operating margin stood at EUR 3 billion or 5.9% of auto revenue.

Mobilize Financial Services operating profit increased by EUR 194 million to reach EUR 1.3 billion. Let's deep dive on the group's operating margin evolution, which was up EUR 146 million.

First, currency impacted positively by EUR 143 million, reflecting mainly the positive impact of the Turkish lira on production costs. The volume impact was flat as the positive effect of group sales was offset by lower sales to partners, as already mentioned.

Looking at the next 2 buckets, the group continued to work on the combination of the 2 effects, cost on one side and price mix enrichment on the other to further improve contribution margins. Passing a portion of our cost reduction to our customers is, for us, an efficient way to drive competitiveness on the product.

It allows to offer more attractive vehicles in terms of price and content while offsetting regulatory requirements, especially on new models and facelifts, for example. In 2024, costs decreased by almost EUR 800 million, thanks to the great work from our procurement teams, in particular, that delivered nearly EUR 0.5 billion of savings and also supported by a raw material tailwind of almost EUR 300 million.

This operational cost performance more than offset the EUR 467 million of price/mix enrichment. Net, these 2 buckets drove a positive impact of EUR 325 million.

R&D costs impacted negatively by EUR 115 million. The higher R&D spends in '24 of about EUR 90 million and the effect of a lower capitalization rate were partially offset by lower amortization and R&D billings to our partners.

The capitalization rate decreased 7.4 points versus '23 to 43.6%, mainly due to the non-capitalization of the R&D spend on SDV, the software-defined vehicle, in line with our practice in this area. SG&A expenses were up EUR 177 million, mainly driven by higher marketing costs related to product launches and to a lesser extent, by the current performance in Formula One.

The others item was a positive EUR 157 million, thanks to the strong performance of the aftersales and services business. The last bucket highlights the impact of the deconsolidation of Horse.

I think you're now familiar with the mechanism since November 2022 and until it was deconsolidated on May 31, '24, Horse was treated under IFRS 5 assets held for sale. And therefore, the amortization of its assets in our accounts have been suspended.

Since the deconsolidation invoices paid to Horse by Renault Group include the cost of amortization again as well as Horse's markup, the cumulated effect of these 2 elements represented EUR 55 million for the month of June and EUR 330 million in H2, meaning in total, EUR 385 million for the full year. As a reminder, the synergies generated by Horse Powertrain will more than offset the markup paid to Horse from the second year of implementation of the JV.

We'll then start to buy the engines cheaper than when we were manufacturing them ourselves. Switching to Mobilize Financial Services.

The business generated EUR 21.5 billion of new financings, up 2.4%, thanks to the growth in registrations mainly. Average performing assets amounted to EUR 56 billion, up EUR 4.8 billion versus '23, mainly driven by the growth of the auto business, both in volume and in average ticket per vehicle.

Net banking income as a percentage of average performing assets slightly increased. It's worth noting that 2023 had been impacted by negative swaps to the tune of EUR 84 million versus while the 2024 impact of this item was not significant.

The cost of risk at 31 basis points remained in line with last year and below our historical levels. Operating costs in absolute value remain well contained and improved by 8 basis points as a percentage of average performing assets.

Overall, Mobilize Financial Services posted a solid operating profit of EUR 1.295 billion, up EUR 194 million year-over-year. Now let's move on to the key elements of group's P&L below the operating margin line.

Other operating income and expenses were negative at EUR 1.7 billion, including EUR 1.5 billion of capital loss on the disposals of Nissan shares made in March and September. It also included EUR 0.3 billion of impairment on vehicle developments and specific production assets, and EUR 0.3 billion of restructuring costs.

These effects were partially offset by EUR 0.5 billion of capital gain on the Horse deconsolidation. Net financial income and expenses amounted to EUR 517 million compared to EUR 527 million in '23.

The lower cost of debt was partially offset by the negative impact of hyperinflation in Argentina. Associated companies contributed negatively for EUR 521 million.

It included 2 things. First, Nissan's contribution, which stood at EUR 211 million compared to EUR 797 million posted in '23, so down more than EUR 500 million.

Second, a partial markdown of EUR 694 million was recorded on the Nissan shares in our balance sheet. This resulted from the annual impairment test, which took into account lower assumptions received from Nissan as regards their business plan.

The contribution of Horse is also on this line and amounted to EUR 64 million for the 7 months since deconsolidation. Current and deferred taxes represented a charge of EUR 647 million compared to EUR 523 million in '23.

The increase in tax charges is linked to an increase in taxable income. The effective tax rate was stable at 18%.

All in all, including EUR 1.5 billion of capital loss on the disposals of Nissan shares, EUR 200 million of Nissan's contribution and the partial impairment of the Nissan shares, net income group share stood at EUR 0.8 billion. Excluding the capital loss, the sharp decline in Nissan's contribution and the partial impairment, our net result group share increased by 21% to reach EUR 2.8 billion versus EUR 2.3 billion in 2023.

Just a quick word on return on capital employed, which is not on the screen. In 2024, we remained totally disciplined towards maximizing returns.

Our return on capital employed was again close to 30%. This is an industry benchmark level, and we'll continue to focus on it constantly.

Now let's switch to free cash flow. Cash flow stood at EUR 5.2 billion, including a EUR 600 million dividend inflow from MFS in 2023.

Group CapEx and R&D as a percentage of sales, excluding the impact of asset disposals, represented 7.2% of revenue, down 0.1 points year-on-year, but remained well within the limits of our guidance, which is below 8% of revenue. Asset disposals amounted to EUR 94 million compared to EUR 282 million in 2023.

Change in working capital requirements was a tailwind of EUR 844 million, driven by the high level of activity, in particular, in Q4 compared to last year with the product launches. Restructuring cash out amounted to EUR 379 million compared to EUR 496 million in the previous year.

Finally, Renault Group generated a solid EUR 2.9 billion of free cash flow in 2024. Over the last 3 years, this represents a free cash flow generation of EUR 8 billion.

The free cash flow contributed to almost doubling our automotive net cash position, which improved by EUR 3.4 billion and reached a historical record level of EUR 7.1 billion. Net financial investments and dividend paid include around EUR 260 million of investment in Flexis.

Dividends paid to Renault S.A. shareholders strongly increased in '24, as you know, at EUR 1.85 per share, representing EUR 540 million, while we benefited from EUR 142 million of dividends received from Nissan.

The Horse operation generated EUR 1.1 benefit -- EUR 1.1 billion benefit on the automotive net financial position. Around EUR 300 million of that came from the 10% stake disposal of Aramco, while the rest corresponded to the deconsolidation of that business' net debt.

The disposal of nearly 295 million Nissan shares generated EUR 852 million of cash inflow. And to finish, the others effect, mainly driven by the purchase of treasury stock and the IFRS 16 impact amounted to EUR 454 million.

At the end of 2024, automotive liquidity reserve stood at a very comfortable EUR 18.5 billion versus EUR 17.8 billion on December 31 of '23. I'll end my presentation with a dividend that we will submit to the approval of the general assembly on April 30, '25.

We will increase the payout from 17.5% on '23 results to 21.5% of 2024 net income parent share from which we have excluded the EUR 1.5 billion of capital loss on Nissan shares and the EUR 0.7 billion of impairment of the investment in Nissan. This dividend of EUR 2.20 per share for the financial year '24 represents an increase of 19% versus last year.

And now I hand over back to Luca for the financial outlook.

Good. Thank you, Thierry.

Since Thierry will soon take off towards new Adventures, I actually don't want to miss the opportunity to thank him for all the work he has done over the past years and for his achievements, of course. So, Thierry has been a key pillar of the Renaulution and one of those persons who have allowed us to pave the way for Renault's future.

So, also at the moment when the company prospect was pretty bleak, if you remember. So, thank you, Thierry, and eternal gratitude to you from Renault.

So now let's take a look at what comes next for the group. Let's not wait to talk about the elephant in the room.

This CAFE, as you know, mitigating the CAFE impact regulation will be key in 2025. We are going all in to tackle it.

Will activate mainly 2 key levers. So, on one side, we maximize EV and HEVs penetration, and are looking for a potential arbitrage on ICE volumes, so big offers.

So, embedding the CAFE contribution at every level of the operation and monitoring the thing at the group level. Actually, we do it almost weekly to ensure that we achieve a group optimum will be, I think, our 2 guiding principles.

So lastly, keep in mind that we are only at the beginning of our EV product offensive. We are spinning up since last semester, for example, with Renault 5, and this is just one car out of a full lineup that's going to come already this year.

Overall, the EV mix represents today 17.3% of our order book at the end of December and it is actually -- it keeps accelerating. So, I think this will allow us to give you a perspective on 2025 that includes also the impact of the CAFE.

We aim to achieve above 7% of operating margin this year. It includes around 1 point of estimated CAFE negative impact.

And we will try to generate more than EUR 2 billion of free cash flow. This is partially due to the fact that we expect EUR 150 million Mobilized Financial Services dividend versus EUR 600 million last year.

So, MFS dividend policy is based on a minimum level of equity to keep complying with both the European Central Bank and the credit rating agency solvency ratios. So, as financing outstanding have strongly increased in 2024 because the business was growing, which is good news, of course, MFS dividend for 2025 will be potentially exceptionally low.

Nevertheless, this is only for 2025. And we confirm that from next year, MFS dividends will rise again to return to historical average.

On top of that, we will double down on cost reduction, on the wake of the significant improvements that we already achieved last year, 2024. We've made a progress on -- significant progress on variable costs in 2024, reducing them by over EUR 700 per vehicle.

In 2025, we'll go further, and we'll focus on endogenous factors to keep delivering necessary performance. We're also going to push on productivity.

Last year, we achieved significant progress, for example, in our IT and R&D functions. It allows us to keep up, I would say, a high speed in our investments to prepare the future of the group.

And productivity will remain high on our list this year, especially through a program that we call the Speed of Lightness which aims at doubling the speed of execution of 11 core processes of the company. We already talked about the product development and the Twingo being a good example.

And of course, we'll keep rolling out our 40% EV cost reduction road map. I can confirm that we are on track on this objective.

And I think, again, the Twingo being 40% cheaper than the Renault 5 is already a good proof of concept. So, we'll have a lot on our plate this year on the cost side, and I am very confident because we can count on Duncan Minto, our new CFO, to make it all work.

He's a Scottish. So that's knowing the reputation is pretty reassuring for a CFO.

But Duncan has an in-depth understanding of the group and its brands because he's been in the house for a long time. So, we are excited to have him on board driving performance even higher.

So welcome, Duncan. You can also count on us to keep the pace of our product offensive.

We'll have 7 launches in 2025 and 2 important facelifts, strengthening our offer everywhere it matters to take the next challenges on a difficult market on the EV side and on the ICE and hybrid side in Europe and on the global market. All our brands will have new cars this year.

There will be the Renault 4, of course, which is, I would say, pretty versatile electric, a kind of iconic product into the B segment. And we have a for mobilized Duo and Bento -- we'll move forward in reinventing connected and smart urban mobility.

So, after the A290 last year, the A390 will be a new major step on Alpine's way to build its all-electric dream garage. So, imagine a Tesla with a so and packed with adrenaline.

We'll have also one more car designed to democratize EV on the international markets. But alongside our EV push, we continue to develop our range of ultra-efficient E-TECH hybrid cars.

Supporting our global ambition. For example, the launch of Bigster will be 2025 big event.

And I think a key milestone on Dacia new and very profitable journey into the C-segment. We'll revisit an iconic model with a stunning design.

I keep it there. And Renault globalization strategy will also be supported by a brand-new C SUV offer that is coming and it's a very, very heavy program also in terms of volumes.

So, I don't think that we will stop there. The reveal of the new Twingo production version and that of the Flexiban will foreshadow the heads that we already have in store for 2026.

It's clear that we've turned Renault Group into, I think, a very nimble, effective and efficient machine. Fit for navigating today's stormy waters.

But that was just the appetite. Now it's time for us to open a new chapter, allowing this company to serve the wave of opportunities created by the unprecedented disruption on the way.

We call it Futurama. And right now, we are working hard in the kitchen, but I can already tell you that Futurama will be about 3 things.

First, it will be about investing in Renault Group, reinvesting in ourselves. We have the money to push product innovation to the next level and to position this company at the forefront of excellence and productivity across all functions.

I think we are in a moment of technological discontinuities, and it gives us once-in-a-century opportunity to put Renault Group in the Champions League of car making. So, we're going all in on innovation to make the most of this opportunity.

Second, Futurama will be about scale because scale is set to remain key in an industry that's capital-intensive. But actually, we are looking for smart scaling.

That's why we have started with our horizontal approach a few years ago, for example, with Horse partnering with Geely and playing on synergy and volumes or with Google on the software side. What we're going to do now is first reviewing the 20 strategic partnership that we have kind of organized during the revolution and then accelerate and reinforce this approach.

And finally, third, Futurama will be about reinventing Renault to free from the cyclicity curse that always looms over this industry. So, the systemic shift that's happening right now opens a lot of opportunities on new value chains adjacent to our traditional business-like energy or new areas of demand for our bank or software.

It's not about breaking away from what we have always done. It's about broadening our scope, going where there is value to create and recurring value to tap.

These are times for the braves and for the challengers, those that will dare to take risks and make bold decisions faster. So, Renault Group journey over the last 4 years has been pretty exemplary of that, I think.

So, what I can assure you is that we're going to stick to this disruptive mindset and all the people in Renault Group now have the direct experience that with a lot of hard work, with courage, with a bit of common sense, this approach can do miracles. So, actually, we are going to push it much further.

And I can tell you that there are a lot of appetite in this company right now to open this new chapter. So, thank you all for your attention.

And now I'll open to your questions. So, stay with us for the Q&A.

We'll start with Thomas Besson from Kepler.

Congratulations on these numbers. I have 2 kind of strategic questions and one smaller question, please.

First, on what you call the elephant in the room. So, the CO2 compliance in '25 and beyond.

You've made clear you don't seem to want to participate in any kind of pooling, I understand because financing your competitors is not a great idea. But I mean, the HEV success you've shown with 20% share cannot hide the fact that on the BEV side for the time being, you're a bit behind after couple of years of volume decline.

Clearly, an inflection point in terms of new product launches and order intake. Can you be a bit explicit in terms of telling us whether you are going to try to sell 19%, 20% of your mix in Europe as BEVs or not?

And explain as well why so many R5 have been shipped in November, December, while in the math of the European Commission, these cars do not count. That's the first question.

The second question is about the key partners. So, for me, it's Nissan and Geely.

I know it's clearly more for Futurama, as you call it, with another new name. I mean, it clearly has a lot of implication for your future new cars development for the next C-segment BEV platform from where you're going to develop cars?

Is it going to be more in China like for the Twingo? Is it going to be more like in France with the Techno center.

What can you tell us in terms of the evolution of this relationship and whether there is a possibility that if the Nissan partnership ends somehow, there could be a capitalistic link with Geely or not? And the final question, which is a lot easier is about what I would call a partner car.

The new Koleos is a huge success in South Korea. I think it is pretty much a Geely PHEV that also sells very, very well in China.

Can you help us understanding the contribution of a car like this to Renault's operating profit?

I mean, of course, let's say, of course, we have to try to achieve the CAFE. So, we set all the system to try to get to this result.

You have to do it in an intelligent way. First of all, we decided for the time being, we would not pull the thing because we consider it a little bit surreal that we have to pay money to non-European competitors, okay?

So, we try to do it with our own things. Renault is -- when I was speaking about 7, 8 months ago when I was President of ACEA about the 15 -- more than EUR 15 billion risk, I was speaking for the whole industry, right?

And the problem -- I mean, if I had to do it again, I would repeat the same message that I gave -- so the problem is still there. There is more than EUR 15 billion risk or impact of this thing into the system.

So, I hope that the authority will listen to our alert and give a flexibility to the thing. But of course, when you are into a budgeting or a planning thing, we are obliged to look at the reality.

We have a chance, as you said, with Renault 5, Renault 4, A290, Spring and maybe kind of a refresh of some of the products through grow compared to what we did because we were in the lower part of the life cycle. The EV market is going half of the speed of what it should go or it was forecast to go.

This is the reality of the story. But for Renault, we might have the advantage of being the first, for example, to get into smaller car with EVs, A-segment, B-segment.

I mean, those 2 segments that represent 1/3 of the European market. So, we have a couple of years of advantage at least to any of our competitors.

And this gives naturally accessibility and access to a different market. That's why we did the Twingo.

I mean, you take a country like Italy, I mean, the A-segment is 10% of European market, going down because there's no offer, okay? But in a country like Italy, it's 25% historically, it's 25%, not because people don't have money, just because the car, they don't fit in the cities.

So, Twingo will be, of course, an additional model to our volume. The EV, let's say, development is actually surprisingly good.

We have 1/5 of the market in Europe. After 4 years, we are already one of the leaders in that technology.

Normally, we sell small cars and efficient also ICE. So, in fact, we need to do something like for Renault between 20%, 22% mix to achieve the thing.

So, we'll try hard. But this is a game theory story, right?

So, there are some players that will have a lot of problems to get there. So, it will naturally put pressure on the pricing, et cetera, et cetera.

So, we have to be intelligent not to kill the baby in the cradle because if we want to have a solid long-term business on EV, we can't destroy residual value, pricing, et cetera. We first have to reduce the cost, which we're doing with Ampere and then get that value to the consumer.

But you cannot do it like this. And this is the problem of fixed deadlines.

So that's why we are calling for flexibility and maybe banking borrowing thing or approach to the regulation because it kills value basically. So, we'll try hard.

We'll see if we make it, but it's not going to be easy to do this kind of thing. But at least, we try to be transparent with you and integrate that impact, the impact that we see, okay, or the things that we already have put on the table on the budget to make sure that we can achieve.

So, Thomas, I hope it answers to your question. Second question was about Geely, Nissan, et cetera, et cetera.

And you mentioned also the Korean product. So, what we're trying to do is on the engineering side, on the purchasing side to create an ecosystem, a system that is connected to places where you find competitiveness, both from the supplier side, also from the engineering side.

It doesn't mean that we are moving everything there. We try to strike the right balance between what we do in France and what we do somewhere else.

And sometimes we actually do it together. You take ACDC.

I mean, you have a heading ACDC, you have a guy that's called Philippe Brunet. This is one of the senators in Renault is there since 30 years.

And he is ensuring the connection between the people at the Techno center and the people that are in Shanghai and bringing some ideas, we work together, et cetera, et cetera. So, because we have to learn.

We have to be humbled enough by what's going on in some areas in the world, see opportunities and get them in our product for our customers. But it's very clear that Techno center stays the center of gravity of our engineering system.

They have to prove that they can do high value-added jobs. And as part of the Futurama program, you will see that we will show you, okay, what these guys are up to, okay?

Because the request I gave to the organization is to step up the game and prove that Renault could be -- could play in the Champions League or actually in the final of Champions League when it comes to technology and gym. So don't force me to spoil a story that we are building and we're cooking in the kitchen.

The Geely story versus Nissan, I mean, the construction with Nissan, you know it since 25 years. I don't think that you need to have capitalistic ties to do things.

And the Geely story proves that is the case. I mean, in the case of Korea, we actually had a capitalistic tie because in exchange of accessing to the platform, we gave 34% of the assets that we had in Korea.

It's working pretty well. As you said, it's a success.

It's actually an HEV that we have there, not a plug-in hybrid. We are planning to do other products, but we try to stay agile, flexible and have a relationship with some partner, which is not as constraining, okay, that we used to have in the past.

So this is, I think, more adapted to our times, right, and gives us more flexibility and agility. And you avoid running the business by Boards of Directors, committees and governance things.

You just try to do the thing, the project and to deliver technology and deliver on the business side. So, I don't have in mind what is the contribution of the thing, but maybe Thierry can answer.

Yes. On Koleos, Thomas , so first, the car is relatively low development cost as it's an existing platform, et cetera.

So, from a return on capital employed perspective, it's a great car. It's a very good profit level.

To give you an order of magnitude, we sold north of 20,000 units just this year just in Korea. I mean, when I say this year, in 2024.

In 2025, the car will be rolled out in Latin America and in the Gulf. We expect that volume to more than double in 2025.

So, when we did Renaulution, we invested in Europe first, and that's what you see in the numbers today with the growth that's roughly 2x the market. Now products like Grand Koleos are going to come out in the international markets.

And a couple of cars like this that represent individually 50,000 units or more with good level of profitability and relatively low investment are very, very interesting for us. So, it's a good car to have in the portfolio.

Thomas, one thing that I didn't answer is why we delivered so many Renault 5. First of all, because we have an order book since months and months, people were looking for the cars.

We actually had to do the CAFE also in 2024. According to our estimation, we made it in 2024.

Then you have official calculation that coming later by a small margin. So, this thing is becoming not so easy.

That's why we worry about 2025 where you have a step where you have to go down 15% in one shot. But that's also the reason why.

So, we had to do a mix of EVs and also in 2024.

We will now take a question from HSBC. Pushkar?

Firstly, best wishes to both Thierry and Duncan for new challenges in your new roles. And I have a few questions, maybe a couple for Thierry and then one for you, Luca.

So, the 1% impact related to CAFE, is it possible for you to break it into components? Like how much of is it are you expecting in terms of maybe penalties?

Or is this mix dilution because of more BEVs? And if there's any supplier compensation included within that, like some of your peers have talked about.

Then the inventories, big buildup on the dealer inventory levels. Is that purely driven by new launches?

And then how do you expect that to develop across the quarters? And then one for you, Luca.

You mentioned about the development time lines with the ACDC in China. It looks well below 2 years now and very competitive versus the Chinese carmakers.

But how does the economics of that work? I mean, how do you make money with such short time lines?

Because the Chinese, if we look at their OEMs, they have the domestic Chinese OEMs, they are not making money. So how does that part of the equation work?

Pushkar, on your first question on the 1% impact in the guidance. So, as Luca mentioned, we expressed the view that buying credits is not a good option from a competitive perspective.

So, we haven't embedded any of that in the guidance. The way we've built the plan is to be compliant with CAFE requirements.

And obviously, we'll have to wait and see the evolution of demand over time. But essentially, the 1% that you see is the result of the 2 levers that we've got to influence the mix.

One is incentivizing the EV sales more. And the other is reducing the volume on ICE vehicles by sort of doing trade-offs between price and volume on cars that drive a high penalty from a CAFE perspective, right?

So, the point is the result of these 2 levers. By far, the biggest impact comes from the incentives that we've built into the EV plan for 2025, right?

So, we haven't embedded any penalties in that number, and there is no supplier compensations. We are lucky enough to have a very successful HEV range and a lot of product activity.

So that's the way we've built the construction. And as Luca said, the main assumption behind it because we had no choice was that the current framework from a CAFE for 2025 does not evolve, right?

So, we've assumed that we will be held to the current level for the 2025 year stand-alone. If there was to be any sort of adaptation of the rules, then potentially some good news depending on when the timing of the announcements would come.

So hopefully, that clarifies, but we've taken a step, which is to embed our best estimate of what the impact is going to be in the guidance. So, we don't give you several numbers, just one, and it's about above 7% of profit.

Your second question was on inventories. The increase in inventories is due to a couple of things.

By far and away, it's due to the launches, right? So, in the total number of stock that you've got there at the dealerships, 437,000, there's 67,000 or so that's just the new vehicles.

So, it's a very large portion because when you launch vehicles, you need to have the demo cars and the stock and people need to be able to see them. The second element is we're growing.

We had a very strong Q4. Our turnover in Q4 was up more than 25%.

And to be able to respond to that demand, we need to have the right level of inventory, right? And so that's what's driving it.

You can see that the order bank has remained very good, right? So, we're still at 2 months of order book.

So we're very comfortable with the level of inventory that we've got. That being said, with the launch activity continuing, but subsiding a little bit in terms of intensity throughout the year, you should see a slight decrease in the total distribution inventory starting in the H1 numbers to getting closer to sort of the 520,000 mark in total, depending on volume.

But I think the key message is we're growing now, and we need to support fulfilling that demand with an inventory that's a bit higher. And as long as the equilibrium between the order book and the inventory is good, then we keep doing that.

Maybe picking up on what Thierry was saying on the stock. I mean, we are turning around 500,000 stock since 2022.

But in the meantime, I mean, this company grew more than double digits. So of course, if you double the business, you got to have a double of stock.

So, this is a kind of a visual thing you see that's basically the story. And second thing I want to say you -- one thing I want to make clear, I think that nobody will want to send money to Brussels.

So, everybody think assumes that we'll pay EUR 15 billion fines, et cetera, et cetera. But everybody, there will be kind of a last option of resort, right?

So, I rather give the money to my customer because when I sell a car than sell it to Brussels. And I think all my colleagues are thinking the same because when you sell a car, you sell aftersales, you sell financing, you keep a loyal customer that comes back in 60% of the time.

So, I don't think that -- of course, some people there, they count on the fact that we're going to beef up the budget of the European community, but there will be no fine. But the problem will be there, the elephant in the system will be there.

Yes, just to make it clear because some people think that -- and by the way, one of the reasons why we try not to do pooling is that pooling you pay now. And whenever you have a fine, probably the impact on the cash will be beyond 2025.

So, I think it's a smarter strategy to do this, also not to give an advantage to some of our non-European competitors. On the development side, when you move from above 3 years to 2 years of development, our estimation is that we lower down the development cost by 30%.

Of course, the less time you give to the engineers to do stuff, the less money they will spend. So normally, on the development side, if you do it quicker, you save money.

So, your connection between the Chinese are not making money is not because of the speed. It's probably for other reasons.

But normally, when you keep engineering people busy for less time, it's pretty logical, you spend less money. So, what we see and what we bet on is that, that kind of cycle will give us a chance to save 1/3 of the money.

I think there was another question on --?

So we'll now take a question by phone, Jose Asumendi, JPMorgan.

A few questions, please. And Thierry, all my very best wishes.

Thank you for the strong partnership in the past years. Maybe just to kick it off, Thierry, can you comment a little bit on the opportunities that you see in terms of purchasing cost-savings, which was a strong contributor to the profit bridge in '24?

And product mix and working capital, those 3 buckets, a little bit, how do you think about the planning for '25 without spinning the thunder from Duncan? Obviously, as you can say, and maybe, Thierry, as you look back at the last years and you look a little bit forward handing over your job, what do you think are a little bit the pending tasks or the biggest opportunities you see or challenges as you hand over the job to Duncan?

Luca, a couple of questions, please. I would love to hear a little bit more around Renault-Geely partnership.

Are there any regions, any products, any collaboration angles that you think still obviously represent an opportunity? Can you talk a little bit more about the Brazilian opportunity with the Geely?

And then second, Renault-Nissan, I was listening to your comments, you basically said -- I believe you said that you don't need any capital tie-ups to create those strong partnerships. Can you confirm that Mitsubishi vehicles will be produced entirely in Spain?

When I look back at the Renault-Nissan Alliance, Renault-Nissan and Mitsubishi Alliance, I think it's interesting how you're selling the stake at a point in time when the alliance is probably the strongest, which goes back again to the state that you did before. And then second, on this topic, can you comment on whether -- what is the plan with the Nissan stake?

And are you considering selling the stake to an industrial partner? Or is that completely out of the equation for you?

Jose, thanks for the questions. So, first, maybe opportunities on purchasing and cost savings.

As I highlighted in the presentation, we had almost $0.5 billion in cost savings in 2024. And I mentioned purchasing or procurement, but it's really kind of a hand-in-hand job between procurement and engineering.

A lot of it now is not the old recipe of beating up the suppliers to try to squeeze 1% or 2%. It's working upstream in the development of the car to engineer it better, work with the supplier to make the development more efficient and make a car that's inherently cheaper to manufacture.

Luca mentioned the number of parts in the cars. And as he said, when Gilles Le Borgne arrived, we had 2,500 parts per vehicle, and he set the target to get to 1,500 and that seemed like a tall order at the time.

Then we got to 1,000 with Renault 5 or 1,100. And now as Luca mentioned, we'll be at 750 on Twingo.

And it's a big deal, it means more lean manufacturing process, better relationships with the suppliers, complete change of relationship using more off-the-shelf parts, and I think those are the key opportunities. And you're going to see that continue to happen in year 2025, and that's going to be a key driver of the continuation of the operating improvements next year.

And so again, I think it's a different sort of approach compared to the past where it was mostly negotiation with suppliers. Now it's partnership and co-development.

On working capital, look, I think there's still opportunity, right? And I think the team has done a good job of managing inventory levels in terms of new vehicle inventory levels at the end of the year.

We still have -- we had at the end of '24, quite a significant EV battery stock, which the team will be working on to reduce pretty hard. We made good progress on accounts receivable.

Our overdue accounts receivable are at an all-time low, but we can keep working that. So, I think we're not banking into massive working capital improvements in the guidance that we gave, but I think there's still operational activity -- operational opportunity.

And then your general question of what I'm leaving behind for Duncan. Look, I think Luca mentioned the key areas of focus with Futurama, right?

So, reinvesting in the business and technology, doing smart partnerships to go back into conquest from a growth perspective and finally, looking at adjacencies. So, I think these come on top of maintaining the operating rigor that we've implemented over the last 4 years.

So, keep that going, remain true to value over volume and remain true to having the plants that are full and focusing on retail channel, but go look at how we can use some of the cash that we generate to review some of the choices that we made, what we decide to make or buy, the partners that we've got. And at the end, I think we've still got a large growth opportunity internationally for Renault brands, in terms of segment coverage for Dacia, in terms of expansion of the range for Alpine.

So let alone the car business, I think there's a lot of opportunity for growth. So, look, I think there's good times ahead.

Hopefully, that answers your question.

Now to answer your question, I think on the Geely side, of course, there are a lot of things we can do together. I'm not going to spoil everything right now.

We have done -- we started with Korea, it worked pretty well. Then we did the Horse together, it's working operationally pretty well.

We have recently announced something in Brazil, which is also very important, and you will see as soon as the authorities will actually validate this deal, the advantage that it's going to give us. And when I observed Geely, I found that this is -- from a strategic point of view, from the kind of portfolio of technologies that they are focusing on.

It's probably -- I see a lot of similarities to -- in the way the 2 companies see the future of automotive. So, it's very natural.

It's actually, I have to say, probably more natural than the different views that Renault and Nissan had historically in time, right? So, I think there is a lot of affinity between the 2 companies.

So that creates a lot of opportunities, okay? So, we'll continue, and we are working on ideas to find scale together, probably Geely needs also to go beyond China to go more global, we need to also find scale in some operation and it's working pretty well.

And we don't do PowerPoint or make announcement. We try to make the project work.

And it was the case for Korea. It was the case for us.

So, we know how to work together well and create value. We will now focus on Brazil, and there will be other things coming.

I can confirm you that all the products from Mitsubishi and Nissan that we were planning to develop and launch are in preparation. So, there is no change on that.

There might be also some new ideas that we might announce. So, on the alliance side, I think from an operational point of view, the things are continuing, working pretty well.

Of course, priority for Nissan, but this is what you have to ask to the Nissan team is their focus should be in developing a kind of a restructuring plan to get back on track on operations, but that's their problem. Everything that is good operationally for Nissan is good for Renault because we are a shareholder.

So, if it works better, it's better for us. So, we are there also to support in operations if we can help.

And we don't change our philosophy that we want to kind of delever from Nissan participation, but we have to do it when it is the right time. And we don't want to destroy value.

So, we want to defend the value of the assets that we have been building for 25 years together. So, it doesn't change.

Thank you, Luca. We now have a question from Stuart Pearson from BNP.

Sorry if you covered some of it because we're obviously multitasking this morning. But I don't think you did.

I mean, firstly, maybe a question for Luca regarding March 5th and the upcoming European action plan for the auto industry. I know you're close to the political negotiations here.

I know we're expecting maybe or maybe not to hear something around flexibilities. What else do you think we could hear around that plan?

What would you like to see? There's been some discussion around European-wide, block-wide EU-funded subsidies for EV.

Is that even may be possible, do you think? Heard about some ideas around enforcing minimum EV targets for fleet mix as well.

But anything else you think we might expect to see given how close you no doubt are to those talks? The second part, just coming back quickly or second question is coming back a little bit to Geely.

I mean, more broadly, have you been surprised, I guess, that we haven't seen more local capacity investment by Chinese EV players yet. Obviously, we have BYD building, but we haven't seen much from anybody else just yet with some projects have been delayed.

So, I wonder why that is. Is there negotiations going on?

Do you think with different OEMs with those partners? And is it possible that Ampere with Geely could have a production partnership in Europe?

Would be a second question. And the third one, maybe for Thierry or perhaps Duncan, I guess, again Duncan.

The margin outlook for this year, just seasonally H1 versus H2, is it fair to assume that maybe you'd assume H2 to be worse because that's where carmakers are likely to be pushing more EV volume and discounting? Or are there other things going on in terms of Horse accounting, et cetera, that we should think about when thinking about H1 versus H2, just to think how the year is weighted?

I'll start with the third question, and Luca, I'll hand it over to you for the March 5th discussion. For H1 versus H2, look, I can only speak for us.

There shouldn't be a massive difference in terms of profitability H1 versus H2. I think H2 might be marginally better for us just because we will have the full impact of the launches that are coming, and that's always good to protect pricing, et cetera.

From the market generally speaking. H2 is always -- generally speaking, a little bit better for us, but this year, we'll have the product cycle helping with that as well.

I would say, look, it's going to depend on your first question, I think, to some extent, what happens from a CAFE perspective. I mean, today, everyone, I assume, is acting like us under the assumption that CAFE rules do not change.

So, we've taken some pricing actions, both on ICE and EV already to try to influence the mix. And so, if there was to be an adaptation of the rules, then potentially that might represent upside.

But as Lucas said, a quick crystal ball from that perspective, we embedded in the guidance, again, the assumption that nothing would change and then hopefully, something does change, right?

Yes. I mean, as I was anticipating, I actually don't know what will be the outcome.

Of course, we are involved in a lot of discussion. I think they have our wish list.

It's not always the same for each one of the OEMs, I have to say, because people put priority different, but the list of the things more or less is similar. If I had to sum it up for Renault, I think probably you have 3 chapters.

One is related to the fact that we need to give a shock to the demand. I mean, one of the problems is that EVs are running at the speed where they should based on the fact that you have deadlines like this with fix mixes and values.

So, if this thing will be relieved, of course, it's a different story. But we need to shock into the demand and establish EV as one of the dominant technologies in Europe also because we have made investment, you want to keep the value of these things, you don't want to write off things and et cetera, et cetera.

So, this is one thing. So practically speaking, priority #1 for me would be to give flexibility to 2025 so that we can extend the thing maybe on 5, 3 years, et cetera.

So, it gives us time to introduce new products to maybe do some of the things that will enable EVs to become more and more popular. This is true -- for me, this is one thing, so shocking to the demand.

Related to this, you have probably one thing we are pushing, which is greenification of fleets, because fleets, they represent 50% of the European market. So, when you look at what happened, for example, in Belgium, where they went so extreme to say that, I don't know, company cars, they only have to be EV starting 2025.

Of course, EV mix is 30% of the market. So, I don't know if they have to go so extreme.

But of course, fleets, they have to participate to the thing. Otherwise, you put all the weight on retail, which is the other 50% of the market, okay?

I think that the idea of having at least a kind of a pan-European approach to subsidies because -- and stability into the thing so that we know that for 5, 6 years, 10 years, we will have a support to the consumer. That's also something that might be very, very effective.

This is one chapter. Second chapter is competitiveness, okay?

I mean, for example, energy cost is very, very heavy on EVs. Actually, what we see is that you take a Renault 5, the energy cost to produce the car, the whole life cycle, okay, including everything, is actually double the labor cost.

So, if we could buy energy in the sites where we produce cars, in the region where we produce cars, at half of the price we pay today because there is a special support, then it will give us really advantage. This is an example, but the whole story of competitiveness of Europe is very, very clear because we pay maybe a 20%, 25% competitiveness gap to China.

Of course, when they bring the car here, you have to pay logistics, so it's lower. But this is the reality.

So, we have to really -- I hope that they will start to attack the issue of competitiveness in Europe so that we can defend ourselves. I think the third chapter will be on regulation.

We call it better regulation. And what we're asking for is simply to clean up a little bit the calendar.

That doesn't mean that we refuse regulation on the contrary. But they have to be put in batches.

We need to have an anticipation. They have to be stable.

That's the whole discussion about 2035, which is politically very complicated, where we push for technological neutrality. We want them to regulate only the future, not the past because every time, look at GSR2, we have to re-homologate all the cars.

So, I had 1 engineer out of 4 doing regulation at Renault. It's like a 4-cylinder engine running on 3.

And when you do regulation, you waste your time, right? You waste resources because you don't build competitive advantage because everybody does it.

And you cannot create value because the customer will say, sorry, it's the law. I'm not going to pay for your GSR2 or your Euro 7 because it's a low.

And so, for us is we're wasting 25% of our engineering capacity. So, these are the 2 shops.

It's like shock on the demand, competitiveness of Europe and more sensible and common sense regulation. We have 8 to 12 regulation in Europe from now -- every year from now to 2030.

I mean, we make the math. If everything is enforced, maybe this thing will have an impact on the cost of the product by 30%, 40% in general, not EVs.

So, if each one of those regulations that they have in mind will be enforced, is going to actually increase the cost of the product. It's not what we need because people don't have money in Europe, there's purchasing power problem.

So, we need to lower down the cost as we're doing with the Ampere so that we can get back Europe to a decent level in terms of market. It looks like everybody has accepted that the European market should be at 13 million cars.

It's 20%, 25% lower than the historical series. I mean, you know how much every year, they are missing even the authorities in terms of VAT because of this, EUR 90 billion in VAT.

With EUR 90 billion, you do a lot of things. So, the car market needs to go up again.

That's the reality of the story. So that's what you ask.

I don't know what will be the outcome. I'm sure they will do something.

For me, I would quote dragging. But for me, there are a lot of options, just do something, right?

Just decide because it's urgent.

Got it. Just quickly on that point on the Chinese investing locally in Europe, because there's no cooperation between Ampere and Geely right now.

It's all horse and power with Geely. Is Ampere deliberately separate to that?

Or could there be a cooperation there?

No. I mean, all our options are open.

We don't have it right now in the plan. I think we're focusing on Latin American right now because that's the next thing we have to make work.

So, we try to be very pragmatic on operational. We look at opportunity by opportunity.

So far, it worked pretty well with Geely. So, I think it's a very, very good company, a very good team.

They are fast. We think the same.

We find solutions, and that's the way we see it. But I'm totally open.

So this is the end of this presentation, and I will let Thierry, for his last full year results at the group.

Thanks, Philippine. Just very quickly because we're running over time already.

I want to express my deepest gratitude to Luca and to the teams for the journey that we've been through together. I think we've built something that's really, really special.

First, to Luca, I am acutely aware that you're the one who gave me my big break, so to speak. So, the eternal gratitude is definitely on my side.

Then to the teams, the hard work, the commitment through thick and thin has been the backbone of our success. So, working with the Renault teams for the past 9 years has been great fun.

It's been a fantastic learning experience, and it's been a real pleasure. I also want to say thank you to you, our analysts and our investors for very good exchanges and constructive dialogue.

These exchanges are a part of what makes us better and keep improving ourselves. I think the group stands on a fantastic foundation today, and I think it's well prepared for the challenges that the industry is facing.

I think it's actually in a great position to be showing the way in a lot of areas. Then one last thing, I leave in full confidence, having worked with Duncan for the past 9 years, I can't think of a better person to take over and to take it to the next level.

So, I look forward to looking at the next step for Renault Group from across the pond, and I hope we keep in touch. Thanks, everyone.