Car-makers’ Records: Renault Loses, Lucid Motors Merges
3 minutes for reading
I noticed it’s been long since I last spoke about the news of the auto industry. Today, I’m presenting you Renault’s report for 2020 and the plans of Lucid Motors to enter the exchange. Let’s get started!
Renault reports a loss of 8 billion EUR in 2020
On February 19th, the French auto corporation presented its financial report for 2020. Due to the COVID-19 pandemic, the yearly revenue of Renault SA amounted to 43.5 billion EUR, which is almost 21.7% less than in 2019.
The net loss reached 8.05 billion USD, which is, according to Refinitiv, is almost 9% more than forecast. Note that this is the largest loss in Renault’s history. For example, in 2019, the concern reported a net loss of 141 million EUR.
The stock price of Renault SA (PA: RENA) was 39.8 EUR before the publication; when this article was being prepared, it amounted to 36.8 EUR. This means that after last year’s results were reported, the stock price dropped by 7,5%.
What are the perspectives for 2021?
The director-general of the auto corporation Luca de Meo thinks that, as long as the pandemic is still there, 2021 is going to be tough as well. He admitted that, due to a lack of certain electronic components, production might be decreased by 100,000 cars.
Moreover, 14,600 employees will get fired, and some plants will be shut down. Thus the management will be trying to reduce spending in 2021 by 2 billion EUR. The shareholders have been warned that the plan of spending reduction is 60% complete.
Lucid Motors enters the exchange
According to Reuters, a premium-class electric car-maker Lucid Motors is planning a merger with a SPAC Churchill Capital IV Corp to start trading in the exchange. After the merger, the united enterprise will be estimated as 24 billion USD.
This merger is going to be the largest one in the electric car market. According to CNBC, the estimations of Fisker, Nikola, Lordstown Motors, and other car startups after mergers with SPACs were never over 4 billion USD. Lucid Motors will become six-time as pricey.
According to Insider, since the first rumors about the possible merger appeared, the stocks of Churchill Capital IV Corp (NYSE: CCIV) grew by 425%. However, after more details were published, they dropped by 38.63% from 57.37 to 35.21 USD.
What does Lucid Motors do?
- Former Tesla employees created the company in 2007.
- It specializes in designing and producing premium-class electric cars.
- Its first concept-car was presented in 2017.
- Electric cars will be produced in Arizona, USA.
- The first car will be Lucid Air; it will cost about 77,400 USD.
- First supplies of this electric car are scheduled for the second semester of 2021.
- The company’s representatives claim that in 2022, the supply of their cars will reach 20,000 units, and in 2026 – 251,000 cars.
- Starting next year, Lucid Motors will appear in the EU, two years later – in China.
What were the records in car-making?
If you thought that the news about the stocks of a new auto-giant Stellantis blowing up exchanges in the US and EU was the only noticeable event in the market, you were mistaken.
New records get set in the auto market. Renault SA reported a loss of 8 billion EUR in 2020 – the largest in its history. I’m sure you know the reason: COVID-19.
But this isn’t it! Lucid Motors might become public. To do without an IPO, the company decided to merge with a SPAC Churchill Capital IV Corp. This will become the largest merger of a car startup with a “dummy company”: after the merger, the united enterprise will cost 24 billion USD.
