PARIS – Renault Group is seeking to expand its sports and racing brand Alpine into larger vehicles and more markets, including North America, potentially leading to an IPO for the unit, which will operate as a stand-alone company by 2024.
The core Renault brand has failed repeatedly to crack to premium market with models such as the VelSatis, Avantime, Latitude and Talisman, Renault Group CEO Luca de Meo said Tuesday in announcing a sweeping reoganization of the automaker.
"The fact is that Renault is a volume brand, but Alpine is a different game," he said.
Read more: 9 things to know about Renault's new strategic direction
In his view, with right ingredients and technologies, Alpine could be the first real opportunity for Renault Group to reach wealthier customers.
Renault has renamed its Formula One works team Alpine to accompany its endurance-racing efforts, and this is giving the brand a boost in global recognition, he said.
De Meo said that while Alpine is now known mainly in Europe, Formula One has tens of millions TV viewers per race globally, and this is opening up new opportunities for the brand. According to Formula One’s own figures, total TV audience for the series in 2021 was 1.55 billion.
Kerrigan Advisors recently sat down with Donnie and Denny Buckalew, co-owners of Buckalew Chevrolet, the 5th highest-volume Chevrolet dealership in Houston, Texas, to discuss their perspective on the changing auto retail industry and how challenges facing single-point dealers influenced their decision to sell their dealership.
As the brand gains global recognition – and launches a range that will include more and larger vehicles than what was previously announced – Alpine could expand into in North America and China, De Meo said. Eventually, sales outside of Europe could reach 50 percent of the total, he said. He also did not rule out a future listing, as sports-car brands Ferrari and Porsche have done.
Alpine -- led by CEO Laurent Rossi -- has just one model now, the A110, which has no electrified variants, but it is now planning a lineup of five full-electric vehicles.
Confirmed are a replacement for the A110, possibly to be developed in cooperation with Lotus Cars, that is due by 2026. Lotus is a subsidiary of Geely, which now has two joint ventures with Renault Group.
Alpine earlier announced a small hot hatchback based on the coming Renault 5 due in 2024 and a compact GT crossover due in 2025.
On Tuesday, De Meo said Alpine would also get midsize and large GT crossovers, due respectively in 2027 and 2028.
De Meo said the platform that will underpin the two larger crossovers could come either from the alliance with Nissan and Mitsubishi or elsewhere.
In the plan presentation, Alpine said this platform would come by partnering with a "leading EV player." Volvo and Polestar both offer midsize electric crossovers, and both are subsidiaries of Geely, the Chinese company that is becoming Renault’s partner in Horse, a spinoff of combustion-engine activities.
Alpine also announced financial targets: to increase revenues on average by 40 percent a year from 2023 to 2030, with intermediate targets of 2 billion euros annually by 2026 and 8 billion by 2030.
Alpine is set to break even in 2026 and to reach an operating margin of over 10 percent by 2030.
The company did not give any future volume predictions. Alpine last year increased sales by 74 percent to 2,659 units of the A110 coupe. In the first half, sales grew by 71 percent to 1,710 units, company figures show.
Alpine had 122 dealers in June and plans to reach 140 by the end of this year.
