{"id":269388,"date":"2025-07-17T13:16:09","date_gmt":"2025-07-17T13:16:09","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/269388\/"},"modified":"2025-07-17T13:16:09","modified_gmt":"2025-07-17T13:16:09","slug":"brutal-cost-cuts-hit-renault-as-alpine-issue-f1-operations-update","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/269388\/","title":{"rendered":"Brutal cost cuts hit Renault as Alpine issue F1 operations update"},"content":{"rendered":"

A damning week for Renault Group on the stock market has seen the automaker shed almost 20 per cent of its share price following an earnings downgrade warning.<\/strong><\/p>\n

Renault is the majority shareholder of the Alpine Formula 1 team which claims the turbulence being experienced at Group level has had no impact on the organisation.<\/p>\n

Alpine plays down staff departures as sale rumours persist<\/p>\n

Alpine has been the subject of intense speculation for some time amid constant claims the operation is for sale, despite repeated and continued denials from the team.<\/p>\n

Renault Group owns 76 per cent of the Alpine F1 team, having sold off a 24 per cent slice to a consortium of investors midway through 2023. It further reduced its exposure last year by announcing plans to end its F1 power unit programme.<\/p>\n

That decision will translate into a saving in the region of $100 million once the supply of customer Mercedes units is accounted for.<\/p>\n

Meanwhile, there\u2019s been something of a revolving door within the organisation\u2019s senior management, stemming back to Laurent Rossi\u2019s appointment as CEO of the team in January 2021. That came in the wake of Cyril Abiteboul\u2019s shock departure.<\/p>\n

It started what has been a steady stream of upheaval at Enstone, with Marcin Budkowski, Fernando Alonso, Oscar Piastri, Otmar Szafnauer, Alan Permane, Bruno Famin, Rossi, and most recently Oliver Oakes having left the team.<\/p>\n

Further to that, it\u2019s been suggested a number of the rank and file have also elected to depart the organisation, with sources suggesting a significant number of trackside personnel have tendered their resignation.<\/p>\n

That has been downplayed but not denied by the team, reasoned that while some staff had indeed tendered their resignations, it was nothing more than normal turnover.<\/p>\n

A spokesperson for the team also moved to distance the operation from the turmoil that has engulfed Renault Group this week, stating that the F1 squad is unaffected by announced cost-cutting measures up the food chain.<\/p>\n

On Tuesday, Renault\u2019s interim-CEO Duncan Minto announced an earnings downgrade forecast for 2025, citing sluggish sales in June and a tough market as key factors. Its operating margin is now expected to be five points lower than the seven per cent target.<\/p>\n

It also announced that, while revenue increased to \u20ac27.6bn during the opening half of the year, a 2.5 per cent increase, its cash flow stood at \u20ac47 million.<\/p>\n

\u201cThe timing of this announcement is unfortunate,\u201d said Minto, the same day former Renault Group CEO Luca De Meo officially departed the organisation.<\/p>\n

\u201cBut as you can see, this has nothing to do with the departure of Luca de Meo. Despite this downgrade versus our previous guidance, our results continue to be in line with best-in-class levels for the automotive industry with a structural and sustainable operating margin above 6 per cent.<\/p>\n

\u201cNevertheless, it\u2019s our responsibility to immediately react versus this miss. That\u2019s why we\u2019ve put in place immediate short-term cost reduction measures, and we are accelerating our cost reduction plan with more structural levers, and the details of this will be shared during the H1 results presentation on July 31.<\/p>\n

\u201cThis plan is mainly based on SG&A [selling, general, and administrative expenses] cost reduction plus manufacturing and R&D [research and development] efficiency.\u201d<\/p>\n

The Alpine F1 operation is currently headed by Flavio Briatore, who was appointed by De Meo as an executive consultant in an attempt to straighten out the team.<\/p>\n

His arrival, confirmed midway through F1 2024, was widely seen as a precursor to a potential sale.<\/p>\n

So too was the closure of its power unit programme, a move that slashed the operating costs of the business and made it a far more attractive proposition for potential investors.<\/p>\n

Indeed, sources have suggested at least one approach has been made in recent weeks, with a $1.2 billion sum tabled. It\u2019s understood that was immediately rejected without discussion.<\/p>\n

Nonetheless, whispers that the operation remains on the market remain, with Renault Group\u2019s current predicament serving only to amplify the speculation.<\/p>\n

And with fair reason. The squad is rooted to the foot of the Constructors\u2019 Championship, a performance that will see it bring in the smallest slice of F1\u2019s prize money in 2026 \u2013 a fact that could well see Renault have to top up its budget as sponsorship income is also thought to be comparatively light.<\/p>\n

The team ended last year\u2019s competition sixth in the standings, a fortuitous result largely based on a lucky double podium at the Sao Paulo Grand Prix. Prior to that, it sat ninth on the teams\u2019 table, ahead only of the scoreless Sauber.<\/p>\n

That single performance is estimated to have added $25 million to Enstone\u2019s coffers over the course of F1 2025 (prize money is paid out a year in arrears).<\/p>\n

Should it remain last at the end of this year, it\u2019s staring down the barrel of a potential decrease of over $30 million (depending on F1\u2019s own commercial performance).<\/p>\n

As Alpine toils at the back of its field, Cadillac offers something of a fly in the ointment. The all-new organisation is in the process of building up its workforce, with many of those coming from Enstone.<\/p>\n

While the green fields organisation has no track record of success, it is both well funded and bereft of the turbulence that has engulfed Renault and Alpine.<\/p>\n

Announced over the Austrian Grand Prix weekend, F1 veteran Steve Nielsen is set to join the organisation at the start of September as managing director and essentially act as the direct replacement for Oakes in what was the team principal\u2019s position.<\/p>\n

He\u2019ll work hand in glove with Briatore, the pair charged with firstly steadying the ship before reversing its course. All the while, rumours of its sale persist.<\/p>\n

Read more:\u00a0Pierre Gasly offers blunt Alpine appraisal amid Christian Horner links<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"A damning week for Renault Group on the stock market has seen the automaker shed almost 20 per…\n","protected":false},"author":2,"featured_media":269389,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4103],"tags":[4289,4199,707,4200,225,12,79,16,15],"class_list":{"0":"post-269388","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-f1","8":"tag-alpine","9":"tag-f1","10":"tag-formula-1","11":"tag-formula1","12":"tag-home-page","13":"tag-news","14":"tag-sports","15":"tag-uk","16":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/114868767022440543","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/269388","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=269388"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/269388\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/269389"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=269388"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=269388"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=269388"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}