Renault aims to list Ampere EV unit ‘ideally’ by end of 2023

PARIS — Renault Group still plants to spin off its Ampere electric vehicle unit “ideally” by the end of the year, but the exact timing depends on “market conditions,” CEO Luca de Meo said.

Ampere could have a market capitalization of 10 billion euros, de Meo has said, and alliance partner Nissan intends to invest up to 15 percent. Mitsubishi, the third member of the alliance, is also weighing an investment.

De Meo told investors on the group’s 2022 results call Thursday that he expected to name a leadership team at Ampere by the end of March.

The Ampere spinoff is part of ambitious reorganization at Renault that de Meo announced last autumn. Development and production of internal-combustion engines will be funneled into Horse, a 50-50 joint venture with Geely Group, while the Alpine sports and racing brand will develop a full range of EVs for sale in North America as well as Europe. 

Ampere and Horse would each include about 10,000 employees from Renault Group. 

Ampere could be competing for investors’ funding with other EV-focused listings. Lotus Tech and Zeekr, two full-electric brands from Geely, have announced plans to go public, Lotus through a SPAC merger and Zeekr in an IPO.

Another Geely Group brand, Polestar, has had mixed results after listing last June in a SPAC merger. It received $1.6 billion in cash and financing from its two major shareholders in November “to ensure the company’s growth in a time of volatile markets.”

De Meo has said that Ampere represents a “unique” opportunity because it has a substantial existing factory network that is ready to build hundreds of thousands of EVs in Europe, and more than a decade’s experience in selling electric cars at Renault and Nissan.

Ampere and other new entrants are chasing the success of Tesla, which has recorded double-digit profit margins as an EV-only company, as well as a market capitalization that at times has topped $1 trillion, although its shares have slumped in recent months. 

Tesla has shown that it is not immune to economic forces, as it recently aggressively cut prices in the U.S. and Europe, a move that could boost deliveries by up to 15 percent.  

Ford has trimmed prices of the Mustang Mach-E in the U.S. in response, but has not yet done so in Europe. Volkswagen Group has said it will maintain its EV prices, and de Meo sounded a similar note on Thursday’s investors’ call when asked if Renault would cut prices on the Megane E-Tech compact hatchback.

“We need to stabilize EV pricing at the beginning of cycle,” de Meo said. “You don’t want to create an unhealthy business for the long term.” Price cuts, he said, “destroy value for the customer” because they hurt residual values. “We will continue to protect the value of our EVs,” he said.

De Meo, who is also president of the European auto lobbying group ACEA, said automakers in Europe were facing “asymmetrical” competition from Chinese brands that control the entire EV value chain, starting with battery raw materials. The situation needs to be corrected, he said, if Europe wants to develop its own EV industry.