Renault suffers Euro 2.7 billion H1 loss

French carmaker Renault on Thursday posted a net loss of 2.7 billion euro for the six months ended June 30 as all its major markets shrank due to the global economic meltdown.

The auto major had a net profit of Euro 1.58 billion during the first six months in the previous year.

The total income for the first half dipped by 23.71 per cent to Euro 15.99 billion from Euro 20.96 billion in the corresponding period last year, the company said in a statement.

"We anticipated the crisis from July 2008 and made the first decisions necessary to weather it. Today, Renault is showing resilience, as illustrated by our significant positive free cash flow," Renault chairman and CEO Carlos Ghosn said. During this period, the company sold 1.107 million vehicles as against 1.326 million units in the year-ago period, down 16.53 per cent.

The company has generated a positive cash flow of Euro 848 million in H1 on account of various cost-cutting measures, power investment and lower working capital requirements.

"R&D spend fell by 25 per cent in the first-half of 2007, ahead of the 15 per cent reduction target initially set for the period 2007-2009. In light of this performance, the objective has been revised to a 20 per cent reduction," the company said.