Renault has been hit by what it calls “a rapid and brutal downturn” which took its operating margin from 1.35bn Euros (£1.21bn) in 2007 to just 212m Euros (£191m) in 2008.
Speaking this morning in Paris, Renault President and CEO Carlos Ghosn blamed a “financial and economic crisis of massive proportions that hit the global market in 2008”.
The company says that the controversial 3bn Euro (£2.69bn) loan from the French government was essential to keeping the company running and that Renault would also look to borrow another 400m Euros (£360m) from the European Investment bank.
Renault revealed a breakdown of its market performance in 2008; it showed an extraordinary collapse in the fourth quarter, after what had been a strong start to the year.
The severity of the downturn is reflected in the company’s profit margins, which dropped from between 2.5 and 3 per cent in October 2008 to just 0.6 per cent in December 2008.