• Luca de Meo Fifteenth Protagonist of the Motor of EL MUNDO

Luca De Meo (Milan, 1967) has been in the automotive sector for almost four decades and since 2020 has been leading the Renault Group towards its electrification.

You describe yourself as a 'problem solver' for the automotive industry. What kinds of problems do you face? Making cars is very complicated because every single component and process has to work. You have to take care of liquidity to ensure investment in new developments and, at the same time, you have to make cars that the public like. 'Renaulution' is his great project. Tell us about him. It consists of three phases. The first, the "resurrection", which lasts until 2022. Then the "renewal" will come between the years 2023 and 2025 or 2026 and the third, the "revolution." There are three phases in which we have to work in a complementary and non-sequential way, but in any case we are meeting deadlines. We set out to reduce 2.000 million euros in fixed costs by 2022 and we have achieved it, and you have done it, despite the Covid and the semiconductor crisis ... and with a very deteriorated demand for cars. Regardless, I think 'Renaulution' is working. Also, I am optimistic and I believe that the worst is over. It cannot be that the next few years are as bad as 2020 and 2021 have been, and at Renault in particular the last four years have been extremely tough. And I think people are starting to see the transformation. Let's talk about the models that we will see soon in dealerships. Now the teams are focused on the launch of the electric Renault Mégane E-TechRenaulution 'is working. Also, I am optimistic and I believe that the worst is over. It cannot be that the next few years are as bad as 2020 and 2021 have been, and at Renault in particular the last four years have been extremely tough. And I think people are starting to see the transformation. Let's talk about the models that we will see soon in dealerships. Now the teams are focused on the launch of the electric Renault Mégane E-TechRenaulution 'is working. Also, I'm optimistic and I think the worst is over. It cannot be that the next few years are as bad as 2020 and 2021 have been, and at Renault in particular the last four years have been extremely tough. And I think people are starting to see the transformation. Let's talk about the models that we will see soon in dealerships. Now the teams are focused on the launch of the electric Renault Mégane E-TechNow the teams are focused on the launch of the electric Renault Mégane E-TechNow the teams are focused on the launch of the electric Renault Mégane E-Tech

[arrives in 2022]

. That does not mean that we do not work in parallel on the electronic architecture of the car focused on 5G technology. We will start with Mégane E-Tech and the successor to the Kadjar, but new cars will come in 2023, 2024 and 2025

[including the electric Renault 5 and Renault 4]

In its trajectory, has Abarth refloated in Fiat, the RS range in Audi, the creation of Cupra in Seat, and now, the return of Alpine in Renault? I have always fought for the car to retain its emotional side. I do not share the idea that cars became washing machines, which are all the same. I believe that our responsibility as leaders is that people find the magic in what we do. If he finds it, he will decide with his heart and not with his head. And when you decide with your heart, you are willing to give more. That means price, margins and future for the company. As for Alpine, I don't think I've ever had better ingredients. Better even than the ones I had in Fiat, Seat or Audi. At Audi, my plan was to be able to integrate all the racing part in Audi Sport, which was in Neckalsrum,but there was a lot of politics involved and it was not possible. But at Renault, I have a racing team that I have put at the center of the whole project; I have a Formula 1 team that is the top of the top of the competition; I have a brand with 60 years of history and great victories behind it, recognized among car enthusiasts. So I see a conceptually very easy project; Then you have to materialize it .. How does the French culture fit with the Japanese in the Alliance? Renault and Nissan have been married for more than 20 years, with which the workers are quite accustomed. Of course, when I got here there were 2,500 people with a title in their position that was stated by the Alliance. People who coordinated between the two companies. And it seemed a strange thing to me,Because the best thing is to have a competent uncle at Renault and another competent at Nissan working on specific and joint projects, for which I don't need a referee in between. It is true that there are great cultural differences. The Japanese are very process focused, while Renault's culture is much more Latino. But there are also differences between Peugeot and Renault. Perhaps it is a matter of how and where companies are formed. Peugeot was born in Sauseau, in a region of a Protestant culture created by a family, and is something like the 'French Mercedes', while we are the social, popular company. That said, the connection between Nissan and Renault is very strong, perhaps similar to that between Audi and Volkswagen. Earlier we spoke in passing about the semiconductor crisis,which is creating dramatic bottlenecks. However, it is striking that in the first half of the year manufacturers have made record margins. Companies are reducing costs to ensure better management of stocks and improve cash flow. The automotive industry has had to make a brutal effort to be able to diet and, with a smaller business, to ensure good levels of profitability. As for the shortage of microchips, it is true that before Covid-19, I had already said that we had to go from selling by volume to selling by value. We had bet too much on volume, above the natural demand for Renault, and that destroys the average price at which you sell your cars. We, regardless of the semiconductor crisis, had already headed this way. The reduction of 2.€ 1 billion in fixed costs has meant breaking even for Renault, producing one million fewer cars. For this reason, the few semiconductors that we have we have placed in cars that have more margin, in countries where there is more profitability. It seems inevitable that car prices will rise ... It is true that prices are rising, and in the next 12 months they will continue to do so. The price of steel goes up, aluminum goes up, gas and energy prices go up, copper goes up. And to top it all, there is a shortage of semiconductors, so suppliers push more on prices. How do you solve the semiconductor crisis? It is a very complicated issue. Each of the segments that make up the semiconductor business (CPU, ECU, storage, connectivity,etc.) has a lot of business concentration, with a maximum of three companies dominating 80% of the business. They are American, Korean, Taiwanese, Japanese companies and, naturally, China plays its own league. There is very little European presence, which reduces our sovereignty. The question is whether we are able to resolve this dependency and in how long, because this concentration has been built over 3 decades and you will not recover it in 3 years. There is a European project that aims to manufacture semiconductors in Europe, but it will take 4 or 5 years to build the factory, 10 years to reach the level of competition and 10 or 15,000 million of investment. We have signed an agreement with ST Microelectronics to make the electric motors in house and not outsource it to Bosch or Continental,because we want to control the electronics of the motor, so with batteries, the same thing happens, right? Are gigafactories necessary in Europe? It is a different problem than chips. You can transport chips in a suitcase in the cabin of the plane to run a factory for a whole week. In batteries, the cells are easy to transport, but when they are already mounted in the module, they are heavy, reactive, dangerous and therefore expensive to transport. What I mean is that a battery factory has to be located near an electric car plant. If there are no electric models to produce, it is useless to have a battery plant. Then, going into more detail, it takes a long time to be able to manufacture quality and efficient batteries, which only generate between 5% and 10% of scrap.LG Chem joined us and GM and now they are leaders, but it has taken 10 years to reach a stabilization of the technology. Then there is the question of raw materials: nickel, cobalt, lithium, and manganese. Nickel is the most critical. There is lithium in Europe, but it is necessary to see if there is business to open a mine, while cobalt is 90% concentrated in the Congo. China has bought debt from African countries and thus they have access to these resources. Afterwards, these minerals must be refined. 90% of the refining of these materials is carried out in China. In Europe there is no refining capacity. After that, you have to produce the cathodes and 90% is made in Asia ... In short, if you build a battery plant to make cells in Spain with people who have never made batteries, it will cost them 10 years know how it works.And if you do it with raw materials that come from other regions and you also import the cathodes, in the end all you do is the assembly of the battery, you are not controlling the value chain. Unfortunately, with the transition to the electric vehicle, we are handing over the heart of the product to Asians, when Europe was in control of this with the combustion engine. And what is the solution for Europe if we want zero emissions transport? We will try to deliver. All the announcements that the brands have made are in line with complying with regulations and organizing with our partners to have enough batteries to build our electric cars. But not without impact. We will need time not to ruin the work of decades.The ban on combustion engines by 2035 creates confusion. It's as if I'm going to buy a flat and I know that in 20 years they are going to put a flyover for me where the subway will go, because I don't buy it. This is very dangerous because it does not give us time to pay for the technology or to save the people who work throughout the value chain. What do you propose? We defend a scenario where there is no prohibition, where hybrids arrive until 2040 and then we have another 10 years to evolve to zero emissions. We don't even talk about the autonomous car then ... Right now I am not motivated to develop the autonomous car and that taxi drivers lose their jobs. How do you see Spain? Spain is similar to how I left it. I believe that the Government is taking good decisions to prepare the future of the Spanish automotive industry.The plan that we present to the Government from Anfac comes from Seat and the team we had and which has culminated in the automotive PERTE. I have always said that Spain knew how to make cars very well, but that there was no commitment to R&D, with a deficiency in the electric vehicle and in the software. I see that the authorities are aligned in this regard, now we have to see in what investments and realities that vision materializes. I think that the Spanish authorities have a clearer concept than the Italian ones, although now with the new Draghi government that is changing. Finally, let's go back to 'Renaulution' and the challenges you envision in the long term. As I said, we are meeting the schedule. Now we have to reinforce our reflection beyond 2025, because that year there will be many regulatory and business model changes,and we're going to have to get smarter. For example, we say that Mobilize [the division that encompasses the new mobility businesses within the Renault Group] will represent 20% of the group's business in 2030, but we must specify where that income will come from, if from mobility, of the new services, what kind of services, how much are we going to earn and where ... It is something we have to work on now. Q. - It is a problem to solve. R. - In my career I have always been looking for problems; those moments when, with your decisions, you can make a difference. It motivates me to see things moving forward.but we must specify where that income will come from, whether from mobility, from new services, what kind of services, how much we are going to earn and where ... It is something we have to work on now. Q. - It is a problem to solve. R. - In my career I have always been looking for problems; those moments when, with your decisions, you can make a difference. It motivates me to see things moving forward.but we must specify where that income will come from, whether from mobility, from new services, what kind of services, how much we are going to earn and where ... It is something we have to work on now. Q. - It is a problem to solve. R. - In my career I have always been looking for problems; those moments when, with your decisions, you can make a difference. It motivates me to see things moving forward.

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Keywords: renault group, luca de meo, electrification., sector, renaulution, resurrection, project, seat, public, car, company, problems, cars, phases, costs