Tesla has cut prices on its midsize Model 3 and Model Y this year up to 30 percent in some markets. That has helped put the Model Y on track to be the best-selling model in Europe in the first quarter by a large margin.
“Our intent is not to cut the price” on the Megane, Renault CFO Thierry Pieton told investors on Thursday in Renault's first quarter results call. Earlier this week, Renault brand boss Fabrice Cambolive said Tesla’s cuts would force the group to take a close look at its pricing policy worldwide.
"We will analyze country by country, market by market, which level of competitiveness we need to have to stay in the match," Cambolive said.
Pieton on Thursday said Renault could address pricing on the Megane by offering more attractive leasing and financing terms, and adding incentives such as free charging wall boxes “to make the deal a little sweeter.”
“When you cut prices significantly, residual values take a dip,” he said. “We haven’t made any drastic price changes and we don’t plan to do so.”
He added that the Megane was very profitable from a margin perspective, with 80 percent of buyers opting for a larger electric motor, and more than 60 percent taking the highest trim level. In addition, 80 percent of retail buyers financed the car through Renault.
“There’s no big incentive to cut prices and kill residuals, and go into a spiral,” he said. “If it results in slightly lower volume, so be it.”
“We run the business on maximization of value, not maximalization of market share,” Pieton said.