2002 Annual Report SUMMARY group

Renault, an international, multi-brand group with worldwide scope through its Alliance with , pursues a strategy of profitable growth and corporate responsibility, offering a range of innovative, high-quality vehicles and services. This strategy is structured around five main goals: build recognition for our brand identity; be the most competitive manufacturer on our markets in terms of quality, costs and delivery times; extend our international reach; develop Renault’s core values; and translate success into financial performance. €36,336million 2002 revenues €1,483million 2002 operating margin €1,956million 2002 net income Europe’s No.1 brand in passenger and light commercial vehicles with market share of 10.7% and 15.8%, respectively 2,403,975 vehicles sold worldwide in 2002 132,351 employees Contents

From the Chairman 2 Board of Directors and management team 4 Clear strategy backed by high standards of corporate governance 6 A lasting framework for the Alliance 8 1. Financial performance 10 2. Brand with proven appeal 18 3. Ambitions built on competitive strengths 24 4. Strength and innovation to meet customer needs 32 5. Sustainable, responsible development 40 Looking ahead 48

Summary Contents 1 2002 Renault Annual Report From the Chairman

Renault turned in an excellent Renault was the number-one brand in Western Europe for the fifth year running, gaining ground on nearly performance in 2002. While all markets. Rising sales in Central Europe – where our brand now ranks second – and more distant markets our main markets contracted such as Mexico, Russia, North Africa and the Asia-Pacific region, offset much of the impact of sharp market and we were in the midst of contraction in and the Mercosur countries. In South Korea, rounded out renewing our range, we its offering with a second model and turned in a remarkable performance to make a positive contribution to launched new models group earnings a full two years ahead of schedule. Dacia also reported higher sales and continued to upgrade – including Vel Satis, the new facilities. Espace and Mégane II – on In trucks, AB Volvo returned to profit, bringing us the benefits of a strategic agreement that makes Renault schedule, and increased our the core shareholder of the world’s number-two manufacturer of commercial vehicles. share of the European market for both passenger cars and Our financial results thus reflect a substantial improvement in operating margin and profits as well as a surge € light commercial vehicles. in earnings from our investment in Nissan. Net income came to 1,956 million for a return on equity of 19.8%, We also actively pursued and our balance sheet was strengthened. our drive to reduce costs. Last year marked an important stage in our program to build for the group’s future and profitable growth. Renewal of our range, which is to continue at a brisk pace in 2003 and 2004, got under way with product launches that included Espace IV and the first two vehicles in the Mégane II lineup. These were warmly received, auguring well for their future success and that of the other new vehicles to follow. Our employees’ excellent workmanship is reflected in the awards received by our products. In particular, Vel Satis and Mégane II scored five stars for their performance in the Euro NCAP crash tests, while Mégane II was also voted European of the Year 2003. A major milestone was the implementation of the second stage in the Renault-Nissan agreement, leading to the creation of an automobile group ranking fifth worldwide in terms of unit sales. Made up of two companies with distinct identities and cultures, each with its own momentum, this now operates under the guidance of Renault-Nissan bv, a common management company with responsibility for overall strategy and the development of synergies. The ownership structure of Renault-Nissan bv is designed to ensure a genuine community of interests and the necessary operating autonomy of each partner. Renault and Nissan were thus able to accelerate joint initiatives to cut purchasing and IS/IT costs, develop common platforms and powertrains, and benefit from increased cooperation in sales and production in different regions. These initiatives will be a source of profitable growth for both companies. Moving to back up the favorable dynamics at work during the year, Renault defined and disseminated five strategic goals to support our own program of profitable growth, targeting sales of 4 million vehicles a year as of 2010. These goals are: 1. Build recognition for our brand identity. 2. Be the most competitive manufacturer on our markets in terms of quality, costs and delivery times. 3. Extend our international reach. 4. Develop Renault’s core values. 5. Translate success into financial performance. Adopted and applied by all employees throughout the group, these goals will give us focus and continuity. In conclusion, I wish to congratulate all the men and women at Renault, Dacia and Samsung on their work, expertise, commitment and enthusiasm.

2 Summary 2002 Renault Annual Report Louis Schweitzer, Chairman and Chief Executive Officer, visiting the Auto Chassis International factory on July 17, 2002 with (left to right) plant manager Véronique Van Doren, foreman Olivier Bartoli and maintenance operator Jean-Claude Bobet.

From the Chairman 3 Board of Directors on December 31, 2002

Louis Schweitzer Chairman

Left to right François de Combret Associate Director, Lazard Frères Yoshikazu Hanawa Chairman, Nissan Motor Co., Ltd. President and Chief Executive Officer, Nissan Motor Co., Ltd. Marc Ladreit de Lacharrière Chairman and Chief Executive Officer, FIMALAC Bernard Larrouturou Chairman and Chief Executive Officer, INRIA Not pictured: Jean-Luc Lagardère* General Partner, Lagardère SCA

Henri Martre Honorary Chairman, Aérospatiale Jean-Claude Paye Attorney Franck Riboud Chairman and Chief Executive Officer, Danone Group Jeanne Seyvet Director General, Industry, Information Technologies and Post, Ministry of the Economy, Finance and Industry Robert Studer Former Chairman, Union des Banques Suisses Gérard Debris attends the Board of Directors meetings as Secretary of the Central Works Council.

Pierre Alanche Engineer in charge of overseeing development of Renault’s production information systems Yves Audvard Renault Manufacturing Engineering Technician Michel Barbier Renault Technician Bruno Bézard Head of Shareholding Department, Treasury Division, Ministry of the Economy, Finance and Industry Alain Champigneux Renault CAE Project Manager

* Resigned from the Board on January 27, 2003. Raymond H. Lévy Honorary President

4 Board of Directors Summary 2002 Renault Annual Report Management team

Group Executive Committee on December 31, 2002

Third from left Louis Schweitzer Chairman and Chief Executive Officer, 60 years old

Ecole Nationale d’Administration. Inspector of Finance. Joined Renault in 1986. Became Chief Financial Officer and Head of Strategic Planning in 1988, then Executive Vice President in 1989. Appointed President and Chief Operating Officer in December 1990. Chairman and CEO of the Renault group since May 1992.

Left to right

Shemaya Lévy Georges Douin Executive Vice President, 55 years old Executive Vice President, 57 years old Executive Vice President Chairman and CEO of Renault F1 Team, 56 years old Ecole Nationale de la Statistique et de l’Administration Ecole Polytechnique. Economique (ENSAE). Joined Renault in 1967 as a quality engineer in the R&D Department. Ecole Nationale d’Administration. Joined Renault in 1979, Head of Joined Renault in 1972. After holding various positions at Renault V.I., Became Head of Engineering in 1988, then Vice President, Technology Sales and Marketing from 1991 to 1998, then appointed Chairman and he was appointed Vice President, Sales and Marketing in 1987 and in 1989, before being appointed Senior Vice President Product & CEO of Renault V.I./Mack until 2000 when he was named Executive Chairman and CEO of Renault V.I. in 1994. Strategic Planning and Projects in 1992. Senior Vice President, Vice President of the Renault group. Chairman of from Became Executive Vice President in 1998, reported to by Finance, Product & Strategic Planning and International Operations since 1997. 1986, he became Chairman and CEO of Renault F1 Team in 2002. Audit, Financial Control and Information Technologies & Systems. Appointed Executive Vice President in 1998. The Corporate Communications Department reports to him.

Michel de Virville François Hinfray Pierre-Alain De Smedt Corporate Secretary General Executive Vice President, 48 years old Executive Vice President, 58 years old Executive Vice President, Group Human Resources, 57 years old Ecole Nationale d’Administration. A graduate in engineering and business administration from the PhD in mathematics. Research engineer at the CNRS (National Center Joined Renault in 1989 as Director in charge of European Affairs. University of Brussels. After three years as Chairman of SEAT, he for Scientific Research). Ministry of Labor (1986). Adviser at the He was appointed Director of the Rouen Branch Office in 1991, joined Renault in 1999 as Executive Vice President. Reporting to him Auditor-General’s Department. Joined Renault in 1993. Became Head then Managing Director of Deutsche Renault in 1993. In 1997 he are Research, Vehicle Engineering, Passenger Car Projects, Powertrain, of the Human Resources Department in 1996, and was appointed became Senior Vice President, Market Area , before becoming Purchasing, Manufacturing, and the Mercosur Division. Corporate Secretary General in 1998, with responsibility for the group’s Executive Vice President, Sales and Marketing in 1998. Human Resources. He is also responsible for the Light Commercial Vehicles Division.

Group Executive Committee and Renault Management Committee on December 31, 2002

Louis Schweitzer * Jean-Baptiste Duzan Jacques Lacambre Jean-Louis Ricaud Chairman and Chief Executive Officer Senior Vice President, Supplier Relations Senior Vice President, Senior Vice President, Quality Patrick Bessy Chairman and CEO, Renault Nissan Purchasing Advanced Vehicle Engineering and Research Organization (RNPO) Tsutomu Sawada Senior Vice President, Corporate Communications Patrick le Quément Senior Vice President, Adviser to the Chairman Michel Faivre-Duboz Senior Vice President, Corporate Design Patrick Blain Michel de Virville * Senior Vice President, Market Area Europe Senior Vice President, Vehicle Engineering Development Shemaya Lévy * Corporate Secretary General, Executive Marie-Christine Caubet Executive Vice President, Vice President, Group Human Resources Senior Vice President, Market Area France Patrick Faure * Chief Financial Officer Executive Vice President, Corporate Communications Benoît Marzloff Jean-Pierre Corniou Chairman and CEO, Renault F1 Team Appointed effective January 1, 2003: Senior Vice President, Senior Vice President, Strategy and Marketing Chief Information Officer Philippe Gamba Luc-Alexandre Ménard Pierre-Alain De Smedt * Chairman and CEO, RCI Banque Senior Vice President, International Operations Senior Vice President, Finance Executive Vice President, Manuel Gomez Kazumasa Katoh Industry and Technology Bruno Morange Senior Vice President, Northern Latin America Senior Vice President, Senior Vice President, Powertrain Engineering Rémi Deconinck Light Commercial Vehicles Senior Vice President, Product Planning Michel Gornet Senior Vice President, Manufacturing and Logistics Pierre Poupel Georges Douin * Senior Vice President, Mercosur Executive Vice President, François Hinfray * * Members of the Group Executive Committee Product & Strategic Planning Executive Vice President, Alain-Pierre Raynaud chaired by Louis Schweitzer. and International Operations Sales & Marketing and Light Commercial Vehicles Senior Vice President, Corporate Controller

Summary Management team 5 2002 Renault Annual Report Clear strategy backed by high standards of corporate governance

Board Regulations and Directors’ Charter Board committees

Renault applies best Transparency, dialogue, risk which has also drawn up proce- Three committees, each an integral practices to improve control and elimination of conflicts dures for the use and disclosure part of Board organization, help to standards of corporate of interest are the basic principles of confidential information. ensure that it carries out its duties governance, enhancing underlying Renault’s management. At its meeting on July 26, 2001, effectively and achieves its goals. shareholders’ perceptions The group responded promptly to it appointed a compliance officer The Accounts and Audit of the group and the Viénot report on corporate who must be consulted by all staff Committee, headed by an consolidating confidence. governance in France, published members with regular access to independent director since its In 2002, these efforts in 1995 and followed by a second confidential information to ensure inception in 1996, reviews continued with stepped- report in July 1999. By 1996, it that any exercise of stock options financial reports and accounting up supervision and had adopted a set of Board or other transaction in securities methods to ensure their reliability control to ensure fully Regulations and established issued by a group company is and efficiency. transparent operation. specialized Board committees. proper. The International Strategy These regulations are designed to Committee oversees Renault ensure that the Board fulfills its The Board’s role involves both operations outside Europe and role as an effective representative participation in management and examines strategic guidelines for all shareholders. its supervision, which means proposed by senior management considering the strategy proposed for international business Similarly, Renault responded to by senior management and development. the Bouton report of 2002, much ensuring that it is properly The Appointments and of which is also devoted to implemented. The Board’s prior Remuneration Committee, corporate governance, conducting approval is required for all counting a majority of independent a thorough review of all recom- significant decisions not resulting directors, naturally plays an essential mendations and incorporating the from strategies already adopted role in corporate governance. essential principles into its Board and it is naturally kept fully up It makes proposals for the appoint- Regulations. to date on group finances. ment of new directors, renewal of directorships, management These regulations are backed by compensation and allocation of a Directors’ Charter defining the stock options. powers and duties of the Board,

6 Corporate governance Summary 2002 Renault Annual Report Vel Satis shows its distinctive style.

Performance review Risk management

In 1998, Renault conducted its Risk management is fully identify and monitor risk of all first review of the membership, integrated into all aspects of kinds. It is also charged with organization and operation of its operation. Clearly defined encouraging cross-functional and Board of Directors with the procedures are followed to cross-company initiatives in this assistance of a specialized identify, verify, quantify – where area, and supervising implemen- consultancy. The Board received possible – and deal with risks tation of related action plans. a second report on February 27, associated with Renault’s The department reports to the 2001 and on October 22, 2002 business. These are of three main Vice President in charge of corpo- used this as a basis for renewed kinds: market risk, operating risk rate audit. The Board Accounts examination of ways to improve and legal risk. Management of and Audit Committee is kept efficiency in line with the some types of risk, particularly informed of the main risks and the recommendations of the Bouton financial, is centralized. results of major in-house audits. report. As the Bouton report In the second half of 2002, suggests, reviews are now to a separate Risk Management be conducted annually. department was set up to

Code of Good Conduct

Since 1998, Renault has applied and intangible assets, compliance defining communications policy in a Code of Good Conduct that with the law, respect for the this area. The group compliance provides a framework for environment and partners, officer is in permanent contact relationships with all stakeholders, disclosure and use of information, with the Committee and plays within the group and outside. use of the group’s financial an active role in its initiatives. Circulated to suppliers and most resources, participation in local managerial staff, this was community life and conflicts In addition to the Code of Good reviewed and updated by the of interest. An Ethics and Conduct, Renault has an Internal Board of Directors in 2002. Compliance Committee set up Audit and Monitoring Charter in 2000 oversees implementation defining rules for the delegation Themes covered include employee and new developments within the of operational responsibility by safety, preservation of tangible group, taking responsibility for executives.

Summary Corporate governance 7 2002 Renault Annual Report A lasting framework for the Alliance

Autonomous partners A single strategic united for performance management structure

In 1999, Renault and As originally agreed in 1999, the contributed €1,335 million to The Alliance Board counts eight Nissan joined forces Alliance took a new step forward Renault earnings. This community members, four from each of the in a unique alliance in 2002 through the implemen- of interests makes for additional two groups. Its President is Louis to create a global tation of cross-shareholdings and stability in the shared strategy for Schweitzer, Chairman and Chief automobile group with the creation of a new strategic profitable growth being pursued Executive Officer of Renault, and an industrial and command structure to strengthen by the Renault-Nissan group, its Vice President is Carlos Ghosn, commercial presence equity ties and provide a lasting by the same token favoring President and Chief Executive on most markets. basis for the Renault-Nissan convergence and greater cohesion. Officer of Nissan. The Board has While each retains its group. an extensive brief and wide independence and distinct In this, a key role has been powers to define a joint strategy identity, the two partners Renault raised its equity interest assigned to Renault-Nissan bv, and manage commonality. Its have since moved ahead in Nissan to 44.4% while Nissan a management company assignments include the approval with a common strategy acquired a 15% equity interest in incorporated under Dutch law. of all product and powertrain for profitable growth, Renault, and representation of Equally owned by Renault and plans for the two partners, setting building on shared each on the other’s Board of Nissan, the new company takes priorities and establishing an values of mutual trust, Directors was increased. Renault responsibility for overall strategy, overall planning framework for the respect for each other’s now accounts for four of the nine aiming to generate new medium and long term. The differences and a Directors on the Nissan Board and momentum and broaden the Alliance Board draws up proposals balanced relationship. Nissan for two on the Renault scope of cooperation. The Alliance for joint ventures, major market Board, which has 17 members. Board, which has taken over from initiatives, shifts in product the Global Alliance Committee, offerings, large investments and The two partners are now better met for the first time on May 29, strategic cooperation with other placed to benefit from each other’s 2002. organizations. Finally, it oversees successes. In 2002, Nissan thus the operation of joint working groups within the Alliance.

International Advisory Board (on January 2, 2003) Alliance Board The International Advisory Board, which counts members from the US, Europe and Japan, provides support for the Alliance’s governing body. Louis Schweitzer, President The Board, which welcomed Carlos Ghosn as a new member in September Carlos Ghosn, Vice President 2002, is presided by Louis Schweitzer and Nissan Chairman Yoshikazu Hanawa. Its 12 other members are Pierre Bilger from Alstom in France, Jean-Claude Pierre-Alain De Smedt Casanova from the Institut de France, Jean-François Dehecq from Sanofi- Georges Douin Synthelabo in France, Yoshiharu Fukuhara from Shiseido in Japan, Pehr G. François Hinfray Gyllenhammar from Aviva in the UK, Toru Hashimoto from Fuji Bank in Japan, Norio Matsumura Haruo Murakami from Japan Telecom, Iwao Nakatani from Tama University in Nobuo Okubo Japan, Frank N. Newman from Banker’s Trust Corporation in the US, Michel Tadao Takahashi Pébereau from BNP-Paribas in France, Joseph Stiglitz from Columbia University in the US and Morris Tabaksblat from Reed Elsevier in the Netherlands.

8 A lasting framework for the Alliance Summary 2002 Renault Annual Report The first two common platforms – for the (left) and Renault Mégane II (right). By 2005, these will account for over half the combined output of Renault and Nissan.

Structured cooperation First two joint subsidiaries

Under the leadership of the Alliance Renault and Nissan have A second equally-owned Board, cooperation is first of all coordinated purchasing policies subsidiary, Renault Nissan through 13 Cross-Company Teams since 1999. On April 2, 2001, Information Services or RNIS charged with the development of they founded Renault Nissan was founded on July 1, 2002. The all new collaborative projects and Purchasing Organization company coordinates the work of supervising their implementation or RNPO, an equally-owned IT departments in the two groups, once decisions are made. They company charged with purchasing aiming for cost-effective systems draw support from nine Functional worldwide and achieving and high standards of performance. Task Teams which also contribute additional savings on purchases It thus finalizes the linkup initiated to synergies between Renault and which total an annual €21 billion. through the Renault Nissan IS/IT Nissan in management and Through RNPO, Renault and Office, a joint IT operation set up administration. Nissan have already pooled 40% in September 2001. Finally, there is an Alliance Steering of purchasing, and this proportion Both RNPO and RNIS are managed Committee at both Renault and could in time rise to 70% with the by Renault-Nissan bv. Nissan, while an Alliance gradual sharing of platforms and Coordination Bureau, with offices powertrains by the two partners. in and Tokyo, coordinates working groups and prepares meetings of the Alliance Board.

“At the beginning, cooperation was logistics for parts supplies and were able to work together effectively a challenge, because Renault and supervision of assembly. We got over for the launch of the and Nissan each had a distinct identity this by setting up dedicated joint the Nissan Platina, which is based on and separate organization. But things teams. We still have some work to do the Clio. These two cars, each with fell into place bit by bit and we have to achieve our overall targets, but both a distinct identity, now share a new Armando Avila now found effective ways to achieve businesses have now seen how they market segment and have enabled Director of the common goals. The biggest differences can use their combined strengths. both Renault and Nissan to increase Nissan Mexicana were in manufacturing processes, French, Japanese and Mexican teams total sales.” Aguascalientes factory, Mexico

Summary A lasting framework for the Alliance 9 2002 Renault Annual Report Financial performance

Despite the pressures of range renewal and flat or downward trends in our markets, Renault benefited from a vigorous rise in operating margin as well as healthy earnings growth at Nissan. Improved performance is associated with reinforcement of the balance sheet and a significant decline in net financial debt. These results reflect a strong showing from our Automobile Division, effective cost control and consolidating of the Alliance with Nissan.

Mégane II – combining robustness, agility and fuel efficiency with a light and airy interior.

10 1

11 Key figures and financial results in 2002

Renault confirms its number-one place in Europe and continues international expansion

Global and European automobile markets Passenger cars and light commercial vehicles (millions) 1998 1999 2000 2001 2002 Worldwide automobile sales registrations of passenger cars Western Europe 16.1 16.9 16.7 16.7 16.2 showed a modest rise from 2001 down 2.9% to 14.4 million and Total worldwide 51.6 53.7 55.8 55.6 55.8 to total 55.8 million vehicles in light commercial vehicles 2002. In Western Europe the down 4.1% to 1.8 million. market contracted, with new

Renault group market share in Europe (%) 1998 1999 2000 2001 2002 In Western Europe, Renault took Worldwide, total group sales Western Europe first place for passenger cars with under Renault, Dacia and Renault market share of 10.7% and ranked Samsung brands accounted for Passenger cars 10.7 11.0 10.6 10.6 10.7 number one for passenger cars 4.2% of the market, one-tenth of a Light commercial vehicles 13.0 13.9 14.1 15.3 15.8 plus light commercial vehicles for percentage point less than in the Passenger cars the fifth year running, taking previous year. The Renault-Nissan and light commercial vehicles 11.0 11.3 11.0 11.2 11.3 11.3% of the market after 11.2% Alliance’s 9.1% share placed it Central Europe(1) in 2001. In Central Europe, among the world’s top five (passenger cars and light commercial vehicles) 6.2 6.3 7.0 9.9 10.6 Renault moved up to second place. automakers. Renault group market share worldwide (passenger cars and light commercial vehicles) 4.0 4.2 4.1 4.3 4.2 (1) Not including Dacia brand sales.

Renault group sales worldwide (units) 1998 1999 2000 2001 2002 Western Europe 1,800,998 1,948,449 1,873,868 1,905,635 1,869,251 Rest of the world 317,327 339,782 481,588 507,403 534,724 Total worldwide 2,118,325 2,288,231 2,355,456 2,413,038 2,403,975 of which, light commercial vehicles 261,828 301,210 335,554 338,046 336,392 of which, passenger cars 1,856,497 1,987,021 2,019,902 2,074,992 2,067,583

Group sales worldwide held up in Western Europe and jump of the world, good results on declines in Turkey and Mercosur steady at 2.4 million vehicles in from 9.9% to 10.6% in Central new markets in Mexico and countries. 2002, which saw market share pick Europe. Turning to other parts the Asia-Pacific region offset

12 1. Financial performance Summary 2002 Renault Annual Report Espace IV – well-earned praise for a new top-range .

Renault group sales worldwide by brand (units) 1998 1999 2000 2001 2002 Renault 2,118,325 2,288,231 2,292,353 2,287,804 2,229,112 Dacia --50,562 54,446 57,775 Renault Samsung --12,541 70,788 117,088 Total worldwide 2,118,325 2,288,231 2,355,456 2,413,038 2,403,975

Europe’s leading brand for countries. We turned in particularly Renault Samsung sales surged vehicles sold, including 57,775 passenger cars and light strong showings in the UK and 65.4% to a total of 117,088 under the Dacia brand, 6.1% more commercial vehicles for the fifth Germany, and held on to our vehicles, while in Romania the than in the previous year. year running, Renault improved number-one slot in Spain and group held a strong lead, taking performance in most European Portugal. In the Asia-Pacific region, 57.1% of the market with 66,873

Revenues up 2.6%

At constant scope of Revenues (€ million) Revenues by Division consolidation and accounting Foreign revenues and domestic revenues (%) (€ million) methods, revenues rose 2.6% 2001 2002 % change (1) to €36,336 million. 40,000 40,175 restated published 2001/2002 37,187 37,592 36,351 36,336 The contribution of the Auto- 35,000 Automobile 33,675 34,456 2.3 30,000 mobile Division gained 2.3% 25,000 Sales from €33,675 million to €34,456 20,000 Financing 1,734 1,880 8.4 million. The rise in revenues was 15,000 61.4 63.5 64.5 60.8 61.7 Total 35,409 36,336 2.6 despite the negative impact of 10,000 5,000 exchange rates and sales volume, (1) 2001 data restated on the basis of scope of consolidation and 0 3838.6.6 3636.5.5 3535.5.5 3939.2.2 38.3 which was offset by trends in prices accounting methods identical to those applying in 2002 statements. for new vehicles and an improved 1998 1999 2000 2001 2002 product mix. This reflected the Foreign revenues advent of Vel Satis and Espace IV Domestic revenues at the top of the range, as well as growth in spare-parts business and sales of powertrains to third parties, The revenue contribution of the 8.4% to €1,880 million from €1,734 financing and service business for especially Nissan. Sales Financing Division rose million in 2001, due to increased both Renault and Nissan brands.

Summary 1. Financial performance 13 2002 Renault Annual Report Operating margin up nearly 90% on constant accounting methods

Renault has applied IAS 38 since Operating margin(1) (€ million) Operating margin by Division January 1, 2002. Development (€ million) costs incurred between the 2,500 2001 2002 decision to develop a vehicle 2,205 published published impact before 2,022 or powertrain and the start of 2,000 1,920 of IAS 38 IAS 38 Automobile 216 1,189 587 602 production are now recorded as 1,500 1,483 Sales intangible fixed assets, while 1,000 Financing 252 294 - 294 they were previously expensed Other 5 --- in the year incurred. 500 473 Total 473 1,483 587 896 In 2002, this resulted in a positive 0 % of revenues 1.3 4.1 1.6 2.5 impact of €587 million on operating 1998 1999 2000 2001 2002 margin and €597 million on net income. (1) Operating margin is a significant indicator of business performance, measuring earnings before unusual items. In 2002, operating margin came to €1,483 million or 4.1% of revenues, the Automobile Division was general costs. It also includes a less favorable conditions associated while the figure based on constant €602 million or 1.7% of revenues bigger contribution from outside with a decline in volumes and the accounting methods was €896 million compared with 0.6% in 2001. This Western Europe, driven by a rise in end of Mégane’s lifecycle. or 2.5% of revenues compared with improvement reflects declines earnings from Renault Samsung The Sales Financing Division 1.3% in 2001. On the basis of in research and development Motors and Renault’s growth on new generated an operating margin of constant accounting methods, expenses, which peaked in the international markets. Performance €294 million, or 15.6% of revenues operating margin generated by previous year, as well as in other in Europe was resilient despite compared with 13.8% in 2001.

Net income reaches record high on both published and restated basis

Summary income statement (€ million) Alongside operating margin, main methods, net income was €1,359 items affecting Renault results in million, up from €1,051 million in 2001 2002 published published impact before 2002 were: 2001. of IAS 38 IAS 38 € a 266 million charge included Revenues 36,351 36,336 - 36,336 in other operating income and This good result means that the Operating margin 473 1,483 587 896 expenses, mainly made up of dividend to be proposed at the Other operating income restructuring costs and write- next Annual General Meeting will and expenses 231 (266) - (266) downs of industrial assets, be significantly higher than for the Operating income 704 1,217 587 630 particularly in ; previous year. Net financial income (expense) (64) (91) - (91) a €1,335 million profit on Share in the net income Renault’s interest in Nissan of Nissan Motor 497 1,335 190 1,145 Motor, accounted for by the Pre-tax income 1,020 2,457 805 1,652 equity method, up from €497 Tax (67) (447) (208) (239) million in 2001 in line with Renault net income 1,051 1,956 597 1,359 Nissan’s earnings growth; charges for current and deferred Net income (€ million) Dividend per share (€) € tax totaling 447 million, 2 ,100 compared with €67 million 1,956 1,800 1.2 1.15 in 2001. 1,500 1.0 1,349 0.91 0.92 1,200 0.8 0.76 0.76 All told, net income came to 1,080 1,051 900 0.6 €1,956 million, setting earnings 600 0.4 per share at €7.53. Restated on 534 300 0.2 the basis of constant accounting 0 0 1998 1999 2000 2001 2002 1998 1999 2000 2001 2002 The Annual General Meeting to be held on April 29, 2003 will be asked to approve a dividend of €1.15, 25% higher than that paid for the 2001 financial year. The dividend will be payable from May 15, 2003.

14 1. Financial performance Summary 2002 Renault Annual Report Operating conditions improve

Consolidated cash flow Investments in property, plant and equipment (€ million) and intangible assets net of disposals (€ million) 3,578 3,500 3,314 3,412 3,500 3,205 3,000 3,098 3,000 2,846 2,500 2,500 2,477 2,205 2,437 2,000 2,000 1,688 1,500 1,500 1,000 1,000 500 500 0 0 1998 1999 2000 2001 2002 1998 1999 2000 2001 2002 before IAS 38 Cash flow for the Automobile This reflects in particular dividends In 2002, investments were mainly in property, plant and Division came to €3,179 million received in amounts of €183 million focused on renewal of vehicle equipment and intangible in 2002 or €2,577 million before from Nissan and €77 million from and powertrain ranges and on assets net of disposals and IAS 38, compared with €1,395 AB Volvo. modernization of plant. A more excluding the impact of IAS 38 million in 2001. selective approach reduced the to 6.8% of revenues compared Automobile Division’s investments with 7.4% in 2001.

A stronger balance sheet

Net financial debt Consolidated shareholders’ equity Return on equity Automobile Division (€ million) (€ million) (%) 5,000 12,000 20.7 4,793 11,828 20 19.8 4,000 3,927 10,000 9,652 10,051 13.8 3,000 15 (before 2,700 2,495 8,000 7,861 8,185 IAS 38) 2,000 12.6 11.7 6,000 1,000 10 4,000 7.0 0 5 -1,000 2,000 -1,612 -2,000 0 0 1998 1999 2000 2001 2002 1998 1999 2000 2001 2002 1998 1999 2000 2001 2002

Net financial debt of the reflects the significant impact of €11,828 million. Net financial debt In 2002, Renault achieved its Automobile Division declined exceptional transactions such as of the Automobile Division was target of at least 11% for return €1,432 million to €2,495 million at those relating to the second stage reduced to 21.1% of consolidated on equity, with the actual figure December 31, 2002, a steep fall in the Renault-Nissan Alliance shareholders’ equity at December coming in at 19.8% or 13.8% mainly attributable to improved and the sale of equity interests. 31, 2002 compared with 39.1% a before IAS 38. operating conditions and more Consolidated shareholders’ year earlier. selective investments. It also equity rose €1,777 million to

Renault group workforce

Employees

200,000 Renault employs 132,351 people Dacia workforce, representing a around the world. The decline further 4,663. Following two years 150,000 159,608 166,114 138,321 140,417 132,351 observed in 2002 mainly reflects of exceptionally high recruitment 100,000 the exclusion from the scope of levels, the Renault group none- consolidation of Irisbus, reducing theless took on over 4,500 new 50,000 the total by 3,810, and cuts in the employees in 2002. 0 1998 1999 2000 2001 2002

Summary 1. Financial performance 15 2002 Renault Annual Report Renault shares

Capital stock and ownership

After a difficult year in Two transactions led to significant changes to Renault’s capital stock and Ownership of Renault equity at 2001, Renault shares did ownership in the first half of 2002. December 31, 2002 broke down as better than many in 2002, Nissan acquired a 15% interest through subscription to two reserved shown below. rising more than 13% over capital increases, although it cannot use its voting rights. Following the 12 months to €44.78. these increases, capital stock is made up of 284,937,118 shares with a This made it one of only nominal value of €3.81 each, making a total of €1,085,610,419.58. 3.3% two CAC 40 component The French government sold part of its interest in Renault through a Employees stocks to show a rise; placement with institutional investors. As provided in privatization 3.6% 25.9% the French index itself legislation, 10% of these shares were then offered for sale to group Treasury stock French government fell nearly 34% over the employees. The government’s interest now represents 25.9% of equity period. During the year, compared with 43.8% at December 31, 2001. Renault continued to make direct contacts Free float rose from 46.4% at December 31, 2001 to 52.2% a year later, with investors a central making for greater liquidity and increasing the share’s weighting in major part of its shareholder indices. relations policy. 52.2% 15% Public Nissan

Renault stock-market performance

Against a backdrop of high reflecting a good half-year in the index for French automobile volatility and market slumps, performance from Nissan and the stocks and 29.6% in the DJ Euro Renault stock outperformed success of the new Mégane II. Stoxx Auto for those in the euro indices. At the beginning of 2002, Renault shares thus closed the zone. Renault thus recorded the the share price headed up sharply, year at €44.78, showing a strongest gain of any volume reflecting not only the general rise 12-month rise of 13%. This vehicle manufacturer in the world in automotive stocks but also compares with a 33.8% fall in except Nissan, up 33.2%. Renault’s sales and the strong the CAC 40 and declines of 8.5% earnings posted by Nissan Motor. After reaching a peak for the year € at 57.45 on May 17, the share Renault share performance from January 1, 1997 - December 31, 2002 (€) fell back amid deepening stock- CAC 40 indexed on Renault share price at January 1, 1997: €17 market gloom, but picked up again 65 following the announcement of 60 55 half-year earnings and better-than- 50 expected full-year forecasts. 45 Renault It suffered a significant decline in 40 share price 35 September as a result of a general 30 downturn in the automobile 25 CAC 40 index industry and a fall in Renault 20 15 sales, reaching a low for the year 10 at €34.60 on October 10. This was 5 0 Vel Satis – Renault know-how shines at the top of the range. again followed by a rally, 1997 1998 1999 2000 2001 2002

16 1. Financial performance Summary 2002 Renault Annual Report Shareholder relations – information and dialogue

Since it was floated in November Technocentre outside Paris. Other The Committee met three times Website: 1994, Renault has made it a events for members included a in 2002, on one occasion in full www.renault.com priority to provide individual and preview showing of Espace IV and session with the Renault Chairman institutional shareholders alike a free competition for invitations in attendance. During the year, The Analysts & Shareholders with transparent information, to the Paris Auto Show. consideration focused on share- section of the Renault website gives clearly stated, on a regular and holders’ new expectations shareholders convenient access consistent basis. Ten shareholder meetings were in financial communications and to all financial communications held in 2002 at venues around related improvements in the material. Content includes Set up in May 1995 to consoli- France. Most were organized in shareholders’ newsletter. up-to-the-minute share prices, date shareholder loyalty, our conjunction with stock-market press releases and other Shareholder Club now counts operator Euronext and FFCI, the Over the past five years Renault publications, a calendar of upcoming some 10,000 members who re- French federation of shareholder has also pursued an active cam- events, webcasts of presentations ceive a quarterly newsletter, spe- clubs. Renault was also on hand paign targeting the advisers to analysts in Paris and the AGM, cial reports on topics such as the at the Actionaria trade show for and opinion-makers who have and answers to frequently asked Renault-Nissan Alliance, and an individual shareholders in Paris a significant influence on stock- questions. abridged version of the annual for the fifth year running. market investments – and who are In November 2002, French internet report. To help them get to know thus important relays for informa- specialists Investis named it the best the company better, they also A 12-member Consultative tion to shareholders. Four meetings financial website of any CAC 40 have opportunities to tour Renault Committee for Shareholders was were organized for this group in index stock. sites. In 2002, nine visits were set up in 1996 to help ensure that 2002, one at the Paris Auto Show organized to factories in Flins, shareholders get the information and three in other parts of France. Batilly and Cléon as well as to the they want.

Key figures (€(1)) 2000 2001 2002 Number of shares at December 31 239,798,567 242,196,550 284,937,118 Financial data Net earnings per share 4.50 4.38 7.53 Net assets per share 40.25 41.88 45.57 Net dividend per share 0.91 0.92 1.15(2)

2000 2001 2002 Stock-market data Closing price at December 31 55.50 39.61 44.78 Market capitalization at December 31 13.3 bn 9.6 bn 12.8 bn High for the year 61.00 64.00 57.45 Low for the year 37.53 26.01 34.60 (1) Market capitalization in € billion. (2) Proposed by the Board of Directors for submission to the Annual General Meeting of April 29, 2003. Shareholder information Renault - Investor Relations Key dates in 2003 Dept. 0760 27-33 Quai Le Gallo, 92512 Boulogne Billancourt Cedex – France Tuesday, February 11: Announcement of 2002 full-year results Tel.: +33 (0)1 41 04 59 99 – Fax: +33 (0)1 41 04 51 49 Friday, April 25: Announcement of 2003 first-quarter revenues Toll-free number: 0 800 650 650 (France only) Tuesday, April 29: Annual General Meeting Email: [email protected] Thursday, May 15: Payment of dividend (*) Website: www.renault.com Thursday, July 24: Announcement of 2003 first-half results Renault - Employee Shareholders Thursday, October 23: Announcement of 2003 third-quarter revenues 6 Place Bir-Hakeim, 92109 Boulogne Billancourt Cedex – France (*) Proposed by the Board of Directors for submission to the Annual Tel.: +33 (0)1 41 04 33 46 – Fax: +33 (0)1 41 04 33 52 General Meeting of April 29, 2003.

Summary 1. Financial performance 17 2002 Renault Annual Report Brand with proven appeal Renault was Western Europe’s number-one brand for the fifth year running in 2002, with 11.3% of the market. In other parts of the 2 world, group sales rose 5.4% despite a contraction in Turkey and the Mercosur countries. During the year, Renault vigorously pursued its own international development, together with associated brands Renault Samsung and Dacia, while at the same time consolidating cooperation with Nissan at both global and local levels.

Mégane II, pictured here in Sport Hatch format, was voted 2003.

18 19 Renault – Europe’s number-one brand

On the passenger car market…

With market share of 10.7% in gain added favor having been Laguna took 8.7% of a declining 2002, Renault took first place for awarded a five-star rating in segment in which Renault shared passenger cars in Western Europe, crash tests conducted by Euro second place overall for volume a performance achieved against a NCAP, an independent organiza- manufacturers. Sales of Mégane, backdrop of widespread market tion assessing the safety of new at the end of its lifecycle, tapered contraction except in the UK. cars on the European market. off but the model still ranked It was also despite the fact that fourth in Western Europe. Scénic, several models in the Renault At the top end of the range, with over 2 million units produced range reached the end of their Vel Satis, launched in spring, since launch in 1996, remained lifecycle. has begun to show its appeal the leader for compact for customers who are not afraid despite the gradual diversification The year saw major renewals, too, to break free from market of competing ranges. with good market starts for Vel conventions. And for Espace IV, Satis, Espace IV and Mégane II. its first months on the market A major contribution to Renault’s Presented in autumn, Mégane II confirmed Renault’s firm lead in market success came from its 1.5- was quick to establish itself as the the large minivan segment. and 1.9-liter dCi diesel , A jury of 58 motoring journalists from 22 European countries voted Mégane II benchmark in its segment, winning Avantime, in contrast, got off to which accounted for 47% of sales, Car of the Year 2003 ahead of 30 other the Car of the Year 2003 title to a slower start than expected. compared with an average of contenders. The car won praise for its reward Renault’s confidence in 39.8% on the passenger car expressive design, exemplary handling, this all-important lineup. By the Clio had a record year in 2002, market overall. braking and ride comfort, and extensive range of passive safety features. end of the year, Mégane II sales ranking second in its category had topped 40,000. It should now with 3.5% of the market, while

…and on the LCV market

Renault significantly strengthened Master, raising its market share market at the end of 2002, as well its number-one position for light to over 10%. Kangoo Express was as significant upgrades to the commercial vehicles in Western again number one in small vans Kangoo and Master in early 2003. Europe, with market share up half with 26.4% of the market. a percentage point to 15.8%, Another demonstration of widening its lead on its nearest Aiming for leadership in terms of Renault’s dedication to serving rivals. running costs as well as quality business customers is its network A renewed range offers customers and reliability, Renault designs, of Business Centers. At the end with specialized requirements a develops and regularly upgrades of 2003, 500 were in operation broad choice of attractive high- its range of light commercial around Europe. performance vehicles. The new vehicles to match professional Trafic, on the market since 2001 needs, building in innovative Building on these strengths, and voted Van of the Year 2002, functions while ensuring the best Renault is also well placed to has brought a stylish new touch to value for money at all times. This achieve its aim of selling at least Trafic – a mainstay of Renault’s number-one position this crucial compact van segment, is well illustrated by the new 100,000 light commercial vehicles for light commercial vehicles in Europe. where Renault also did well with versions of Trafic put on the outside Western Europe by 2005.

20 2. Brand with proven appeal Summary 2002 Renault Annual Report Thalia in Prague – gaining new ground for Renault in Central Europe.

Growth on international markets

In Central Europe Renault This strategy was also at work In , where demand consolidated earlier gains and in South Africa, where market plunged 51%, Renault remained took the number-two position with share was 3.5%. During the year, number one with 18.9% of the market share up from 9.9% in Renault announced a joint venture market, while in Brazil, also in 2001 to 10.6% in 2002, equaling with Imperial Car Imports, which the grip of economic difficulties, its performance in Western imports vehicles for distribution sales were down 13% to 61,266 Europe. This sharp rise on an in South Africa and neighboring vehicles, representing 4.3% of the expanding market reflects the countries. The transaction should market. The Mercosur department success of the entire range. get approval from the South responded to market trends with African competition authority measures including a temporary Sales in Eastern Europe and in March 2003. cutback in production at the Russia also grew, with 74,300 Curitiba plant in Brazil. vehicles sold during the year. Turning to North Africa, Renault Mégane and the Clio did posted sustained growth in sales particularly well. In Romania, the of passenger cars and, even more, combined sales of Renault and light commercial vehicles. This Dacia accounted for 57.1% of the reflected a particularly good market for passenger cars and performance in Algeria, where light commercial vehicles. market share was over 28%. In Russia, Renault sales surged 48% to a total of 8,300 vehicles. In Turkey, there was a 14.9% drop in the market but Renault Colombia is a strategic focus held on to its leadership with a of business in the Andean Pact 17.6% share and moved up to countries. Here Renault consoli- third place in passenger cars dated its number-two position, and light commercial vehicles taking 23.2% of the market through combined. The Clio Symbol sedan a factory in Medellin and a network remained the best-selling car in of 31 dealerships. In keeping with the country, with 8.5% of the a strategy of international expan- market. To offset domestic sion, Renault raised its interest in economic difficulties, nearly 90% SA – owner of the Medellin of production at the Bursa factory factory – from 23.7% to 60%. Other was exported. shareholders are Toyota and Mitsui.

Laguna II – new powertrains, new colors, new trim and new high-tech equipment for its first update.

Summary 2. Brand with proven appeal 21 2002 Renault Annual Report Renault and its new markets New international scope through the Alliance

Renault and Nissan continued This is mainly attributable to Sales are now also backed by to benefit from the synergies the success of the 110hp 1.6-liter RCI Banque making new services associated with complementary 16-valve version of Clio II, which available to customers of both geographical positions. Renault accounted for 60% of sales. partners. is thus able to provide effective Produced at the Nissan plant in support for its partner on the Aguascalientes, the model made Renault has also benefited from crucially important Western its debut in February 2002. Scénic Nissan’s presence to develop European market while at the – produced at the Nissan factory sales in Central America, same time cooperating with in Cuernavaca since 2000 – and Ecuador, Peru, the Middle East Nissan in a growing number of imported Méganes each accounted and the Gulf. Nissan importers regional initiatives easing its for 13% of sales, while Laguna II will be selling Renault cars in own moves into new markets. and , both Bahrain, Kuwait and Qatar from imported, accounted for 6% and January 2003. Since its return to Mexico two 7%, respectively. The Renault years ago, Renault has benefited brand’s share of the Mexican Turning to the Asia-Pacific from the strong industrial and market reached 2.2%. region, where Renault is present commercial presence of Nissan in Japan, Australia, Taiwan and Mexicana and in 2002 sold nearly At the end of 2002, Renault Indonesia, sales were up 25% 15,900 vehicles, beating its target Mexico counted 32 franchised in 2002. for the year. outlets built to Renault standards.

Pooling resources for optimum effect

Pursuing their common strategy of profitable growth, vehicles at their counterpart’s plant or production of the Renault and Nissan are steadily expanding the scope of other partner’s models adapted to their specific require- cooperation, sharing organizational resources, know-how ments in their own plant. and skills in a wide range of areas and adopting each By the end of 2002, four factories were involved in cross- other’s best practices. manufacturing operations of this kind. In Mexico, Nissan’s While the partners have maintained separate distribution Cuernavaca factory has been making Renault Scénics since networks to preserve their distinct brand identities, they are 2000, while the Aguascalientes plant has been making Clio IIs pooling sales-support resources through group offices wherever since the end of 2001 and Nissan Platinas, a model based on possible, thereby generating significant savings. At the same the sedan version of Renault’s Clio, since March 2002. In Brazil, time RCI Banque, which backs Renault’s international the new factory at Renault’s Curitiba expansion, is progressively taking over Nissan financing site in San José dos Pinhais has been producing Renault subsidiaries, as is already the case in Western Europe. Master vans and Nissan Frontier pickups since April 2002. Finally, since autumn 2002 Nissan’s factory in Barcelona, Complementary facilities and convergent methods and Spain, has been producing a van based on the . processes let Renault and Nissan use each other’s production Renault and Nissan are now working on a global logistics resources to make the most of overall capacity and extend system. The aim is to establish a flexible manufacturing

The imported Clio Renault Sport – Mexico’s Rally Champion their ranges. This may involve either assembly of their own. base equally able to assemble vehicles for both partners. in the N3 FIA group.

22 2. Brand with proven appeal Summary 2002 Renault Annual Report Renault Samsung Motors, a new life with the Alliance

South Korea is the second-biggest imposed rigorous cost controls benefiting from a triple culture market in the region – 1,241,653 to make the most of favorable and the combined know-how of vehicles were sold in 2002, an market trends. Renault and Nissan in the pursuit increase of 15.8% on 2001. of complementary strategies. In 2002, two years after its launch, In September 2002, Renault Renault Samsung Motors (RSM) Samsung successfully rounded out SM3 – an immediate success in South Korea following its September launch. turned in a remarkable perform- its offering with the launch of the ance on this market, showing a SM3, the fruit of 21 months of “The SM3 has benefited enormously seats. Along with the continued strong profit two years ahead of development work. Coming on top from the high profile that has come success of the SM5, this new schedule. The brand thus made of orders for the SM5, those for with the success of the SM5. The model’s strong start makes us feel its first positive contribution to the new model lifted output for new model combines the intrinsic confident in prospects for another Renault group results. the year to over 120,000 vehicles, strengths of the line with new product we plan to bring out soon, beating targets even before the features appealing to younger as well as in the overall outlook for This reflected the benefits of end of the year. With these two customers. While domestic growth at home and abroad.” highly-efficient, state-of-the-art cars, RSM covered 40% of the manufacturers still account for 99% production facilities at the Busan market and accounted for 9.4% of the South Korean market, there site in the south of the country of the passenger car market. has been significant shift in demand. and the rapid redevelopment of a This is especially true as regards Guillaume sales network applying innovative Like the SM5, the SM3 was vehicle safety, where the country Berthier methods, as well as public developed and produced with lags well behind Europe. The SM3, Marketing recognition for the quality of two technical support from Nissan. which meets NCAP safety standards Director vehicles based on Nissan models. Renault Samsung Motors is a full in full, is thus the first sedan on the Renault Samsung At the same time, the company participant in the Alliance, thus market with side airbags for front Motors Dacia, a fresh start

Dacia continued its recovery with Initiated in 2000 with the support Dacia is moving ahead on a 6.1% rise in sales from 2001 of the Romanian government and schedule with the €5,000 car demonstrating the benefits of the regional environment agency, project. This targets emerging a growing distribution network. plant upgrades and improvements markets, home to 80% of the Dacia sales totaled nearly 53,000 in working conditions illustrate world’s population, where the vehicles, representing 48.7% of Renault’s commitment to sustain- automobile is only beginning to its domestic market. able development. Application of take its place. The car will also waste-reduction at source and envi- make modern technologies in Work on upgrades continued at the ronmental management technolo- key areas such as safety and Pitesti plant, which also launched gies through a shared effort will environmental standards more two new additions to its lineup – raise standards at the plant to match affordable. the SupeRNova Campus and the the best in Europe in just five to first range of light commercial seven years. To take one example, vehicles equipped with Renault Dacia already uses the most diesel engines. In April 2002, advanced ultra-filtration techniques two new stamping lines went in its machine shops. Current priori- into operation and work began ties include management of chemi- on a national spare parts center, cal products and employee safety scheduled to start up in 2003. and health. Dacia assembly line at the Pitesti factory in Romania.

Summary 2. Brand with proven appeal 23 2002 Renault Annual Report 24 Ambitions built on competitive strengths

Constantly enhancing the quality and reliability of products for our customers is a priority at Renault. We make the most of expertise in areas including safety – as illustrated by the five-star ratings Euro NCAP awarded to Laguna II and, more recently, Mégane II and Vel Satis – as well as cost control and industrial efficiency at the highest level in Europe.

The glass roof of Mégane II has a total area of 1.32 square meters, the biggest of any in its segment.

25 Frontrunners in key areas

Safety

Renault has made safety central strength of Renault vehicles, a premiere: front seats with built- to its strategy for many years, critical factor in overall safety, and in anti-submarining airbags for Farid acquiring an unrivaled store of the reliability of restraint systems. safety equivalent to that of the Bendjellal experience and expertise. This However, this is only part of the Mégane II Hatch. This rounds Passive Safety was illustrated in November 2002, picture, since Renault has also out recent enhancements to the Expert when Euro NCAP, the independent dedicated significant research Renault System for Restraint and Renault car assessment organization, resources to developing innovative Protection already available, with Technocentre awarded its top five-star rating to ways to detect emergency its adaptive airbags, inertia-type Mégane II and Vel Satis – as it situations and correct vehicle seat belts, load limiters set at already had to Laguna II in the trajectory where necessary. 600 kilograms, Isofix attachments “There can be no doubt about previous year. Renault thus offers Other priorities are protection of for child seats, pretensioners for the efficiency of Renault’s third- the safest range in the industry. occupants as well as pedestrians rear side seating positions and generation System for Restraint and cyclists. back-seat anti-submarining devices. and Protection. Today research The results of the crash tests Our aim: ensure maximum safety in passive safety is focusing on ‘impact anticipation’ which allows carried out by Euro NCAP The design of our Mégane II Sport for every passenger in every seat, you to gain precious time – demonstrate the structural Hatch thus incorporates a world regardless of their age and build. measured in thousandths of a second! – and makes deployment even more effective. That said, almost 80% of accidents are caused by people rather than the actual cars. Which makes it important to study behavior, and find ways to make drivers more aware and more responsible. However sophisticated onboard systems may be, they can never replace the driver’s skill and attention. Naturally, the safety of children has always been and will remain a major concern. To take an example, we are working on ways Recognition from Euro NCAP to avoid possible error in installing Euro NCAP – for New Car baby seats. Another line of research is the development of Assessment Program – brings digital models to gradually replace together consumer groups and physical ones and gain fresh government organizations from the insights into how the body reacts 15 European Union countries as in a crash. Finally, where active well as specialized laboratories. safety is concerned, we are Founded in 1997, it tests new cars working on systems to allow the exchange of information between and rates safety on a scale of one vehicles and the surrounding road to five stars. Laguna II was the first environment.” Setting up crash tests at the Lardy technical center outside Paris. car to win five-star status.

26 3. Ambitions built on competitive strengths Summary 2002 Renault Annual Report Controlling costs

In recent years Renault has won New Distribution a well-deserved reputation for To win a lead on competitors by reducing costs and, by the same cutting delivery times, Renault token, reinforcing competitiveness was the first manufacturer in and profitability. Our first three- Europe to adopt and apply across year plan was completed in 2001, the board a unique delivery-to- generating savings of €3 billion, order approach. Introduced under and was followed by a second our New Distribution program, this plan, also targeting annual savings system demands the capacity to of €1 billion over three years. make a car to exact customer This drive for rationalization of specifications in a very short time. spending calls for strict manage- Launched in 1999, the New ment criteria and efficiency in Distribution program has enabled both organization and processes. It Renault to better meet customer concerns all areas of operation, all requirements and get the full departments and all disciplines. It benefits of our increasingly broad also – of necessity – requires the range. Three customers out of four participation of suppliers, dealers now wait less than five weeks for and all other business partners. their new car to be delivered, compared with one out of six Purchasing of industrial supplies before the program began. And and services is naturally a special delivery schedules are increasingly focus of attention. Renault has reliable, with over 80% of vehicles developed extensive experience reaching outlets at the date set and expertise that we have put when the order was placed, to good use within the Alliance. compared with only 60% in 2000. Nissan adopted the Renault The New Distribution program has approach to purchasing from also cut costs, reducing vehicle the start, and in 2001 the two inventories by 10% in each of the companies set up the Renault past three years. Nissan Purchasing Organization which has already generated significant economies of scale. Nissan also applies Renault’s strict approach to suppliers of outsourced services, and its purchasing division, like Renault’s, now participates directly in all major company decisions, whereas previously it played only an advisory role. Mégane II Hatch shaping up on the body assembly line at Douai, France.

Summary 3. Ambitions built on competitive strengths 27 2002 Renault Annual Report Renault’s alternative response to economic, industrial and financial challenges

Mégane II shows the way

The platform that began operation Development work on the first Environmental with Mégane II is the second to two vehicles in the range took management be shared with Nissan, and is only 29 months compared with With the Mégane II program, central to Renault’s program for 52 for the first-generation Renault has for the first time inte- the renewal of its range. Mégane, rewarding a fresh grated environmental management Altogether it will be used for seven management approach that called goals into the product lifecycle at models, of which six will be on on all relevant departments, every stage – from design to the market by the end of 2003. functions, factories and suppliers recycling. In particular, carbon- from the earliest stages of the dioxide emissions for the 80hp Mégane II targets an all-important project. This resulted in significant 1.5-liter dCi model have been cut market segment that accounts for savings, with overall program to 120 grams per kilometer. This nearly 35% of cars sold in Europe outlay limited to €2.1 billion. reflects the efficiency of Renault’s and makes a key contribution to latest engines – including diesels both earnings and brand image. The diversity of the Mégane II – as well as work on improving Renault aims for market share of range and its broad scope for per- aerodynamics, reducing friction 14% in Western Europe, with 20% sonalization naturally demands and lowering weight, all features of sales in the rest of the world. maximum flexibility in produc- that impact fuel consumption. It is looking to sell 5.5 million cars tion. Achieving this has meant Noise has been cut to 71 decibels, over the life of the model, 10% reorganization and major invest- below the EU standard of 74 deci- more than with the previous ments in manufacturing facilities bels. And consumption of natural generation. at the Douai plant in France, resources has been limited through Palencia in Spain and Bursa in the use of renewable and recyclable Designed for an innovative Turkey. Manufacturing processes materials. Altogether, 95% of strategy based on the concept of a first introduced at the Douai site Mégane II can be recycled by weight. range within the range, Mégane II and extended to the other two by offers customers unprecedented stages will enhance productivity freedom of choice and thus and overall industrial efficiency, matches a fundamental trend in the target being to cut production demand. Each version has a times by 24% compared with the distinctive appearance and original Mégane. Plants will thus identity for a clearly defined have the flexibility needed to cope customer base. In addition, with commercial flexibility based customers can choose between on a build-to-order system and four trim schemes, three levels of shorter delivery times. equipment, and nine powertrains, combining these at will for a car suited to their personal preferences.

28 3. Ambitions built on competitive strengths Summary 2002 Renault Annual Report 29

Mégane II Hatch in Valencia, Spain, with Science City in the background (architect: Santiago Calatrava). Competitive strength built on an efficient production system…

Launched in 2000, the Renault time taken for design and develop- The Renault Technocentre, our Production Way (SPR) now ranks ment. With Mégane II, Renault vehicle design and development among the best in Europe in terms was able to optimize these aspects site, plays a fundamental role in of performance. Drawing inspira- and achieve its best performance such successes. Constantly tion from the Nissan system, it is ever – without neglecting any stage enhanced, development organiza- based essentially on standardization in the validation process and with- tion is structured around project of operations at the workstation out any compromise on quality. teams that make for greater effi- and reinforcement of first-level ciency, save time and reduce management to make processes Similarly, the overall program out- costs. The Mégane II project more reliable. lay for Espace IV was significantly teams, for example, brought The system calls on the full partici- reduced, with development time together product planners, designers, pation of engineers, production kept to an optimum and manufac- product and process engineers, staff, support teams and outside turing streamlined through integra- quality specialists and IT teams suppliers to track down and correct tion in the Laguna II-Vel Satis pro- as well as staff from purchasing, flaws in the production process gram. Common project after-sales, training and communi- quickly and in so doing achieve management and shared industrial cations departments. This made consistent quality. processes paid off: in production, for optimum synchronization Program profitability also depends it uses the same platform and of product and process engineer- in large measure on the thorough- some of the same components ing and significantly reduced ness of initial planning and the as the other vehicles. overall development times.

Denis Sainte-Agathe at the Sandouville factory in France, now producing Espace IV alongside Laguna and Vel Satis.

30 3. Ambitions built on competitive strengths Summary 2002 Renault Annual Report Quality and transparency – the watchwords throughout Renault’s Mexico network as seen here at the Polanco branch in Mexico City.

…and on the quality and reliability of products and services

Laguna II marked a major advance centers and complaint services, stricter regulatory requirements, in quality and reliability, and the and significant resources are dedi- we pay special attention to fundamental features behind its cated to enhancing professional atmospheric emissions and liquid success have benefited Vel Satis, skills throughout the Renault net- effluents. Action includes raising Espace IV and Mégane II – vehicles work. Our priorities include the the capacity of biological water combining robustness, safety, quality of reception and rapid, treatment units, increasing use of durability, high-performance effective repairs, plus mainte- water-based paints and greater powertrains, and top-quality nance on and off site, as well reliance on natural gas – as at the materials and finish. as making replacement vehicles Douai plant – to reduce sulfur-oxide available when necessary. The aim emissions and eliminate dust. Other Renault vehicles – Clio II, is to keep customers mobile and in Energy saving is another priority, Kangoo and Twingo, to name only so doing consolidate their loyalty. again illustrated at Douai where three – have also benefited, with energy consumption required for improvements to structure and Renault is aware of its responsibility Mégane II is 16% lower than for its equipment developed for vehicles to the community as a whole, and predecessor. Corporate responsi- at the upper end of the range. we are integrating environmental bility also naturally involves continu- management in all areas of opera- ing efforts to improve working con- Leading the field in Europe for tion by stages. Our aim here is to ditions at Renault sites, factoring quality of service, Renault makes keep negative effects to a mini- this into planning of tools and customer satisfaction central to its mum. Thus, all factories are ISO processes used in the development strategy for achieving progress 14001 certified, to ensure ongoing and production of new products. and reinforcing its brand image. improvements to plant facilities Action is also taken to change the Results are carefully monitored and increasingly effective limits on forms of behavior that are the most through surveys, customer call pollution. To meet and anticipate common causes of accidents.

Summary 3. Ambitions built on competitive strengths 31 2002 Renault Annual Report Strength and innovation to meet customer needs In its drive to consolidate ties to existing customers and attract a demanding new clientele, Renault builds on strengths that include a renewed and extended range of vehicles equipped with high- performance engines, and an increasingly responsive and effective service offering.

Shopping around – customer Sabine Lecote learns more about the Mégane II “à la carte” offering from Kader Meraits, salesman at the Versailles Chantiers dealership near Paris.

32 The Renault range

Espace IV benefits from the new platform policy with sedan-like driving sensations.

Settling in at the top

Espace IV has joined Avantime tradition, the new model is much gasoline and diesel engines that and Vel Satis at the top of the more daring in its design. The are the most powerful in the range. Using the same platform spaciously comfortable interior segment. Espace IV is thus well as Vel Satis and Laguna II, it gets added light from the largest placed to defend Renault’s incorporates the same advanced sun-roof area in the market, and position as number one in Europe technology and safety features. road performance has been enhanced for top-of-the-range minivans. While clearly heir to the Espace with more environment-friendly V6

Innovation and diversity underpin the new lineup

With seven different body types and comfort – features passed using the same platform, the down to it from the top of the Mégane II offering has the flexi- range. While a distinctive identity bility to match varied customer gives it special appeal. requirements and tastes, for unri- valed freedom of choice. Mégane Four new products will be unveiled II marks a break with traditional successively throughout 2003. esthetics in this segment, combin- They will make a powerful contri- ing stylish design and a high level bution to the overall consistency of equipment with robustness, of the Renault range. Mégane II targets world markets with sales now spanning 75 countries. advanced safety, driving pleasure

34 4. Strength and innovation to meet customer needs Summary 2002 Renault Annual Report Europe’s most competitive light commercial vehicles Compact class Cars for the love of driving

The Renault lineup of light com- Our smaller cars continue to make The love of driving is part and par- mercial vehicles leads the field in a strong showing despite stiff cel of what Renault is all about, as terms of operating costs, ergonomics competition, with enhanced safety New Clio V6 shows. Displaying and different body conversions. and comfort features plus new even more sporting style than its The smallest in the range is New high-performance engines ensuring predecessors, it is powered by a Kangoo Express, an upgrade that they remain best in class. 3-liter 24-valve supplying with revamped design for even New Clio, with added pace and 255hp through a six-speed close- greater practical appeal. At the power, is continuing earlier suc- ratio manual gearbox in a version other extreme there are multiple cesses: it now ranks second in its with guaranteed appeal for the versions of Master, offering a segment in Western and Central most demanding enthusiast. choice of three . In Europe in its hatch and sedan ver- In a different vein, Mégane II between, New Trafic brings fresh sions. Twingo, a city car that has Coupé-Cabriolet combines ele- style to light commercial vehicles. lost none of its youthful appeal, is gance and pace. Seating four com- The range is ideally suited to pro- now available in a sixth attractive fortably, it will be the first car of fessional needs and offers the collection. Finally, New Kangoo, its kind to be fitted as standard same comfort, safety and high as unconventional as ever, now with a folding metal/glass roof for Clio V6 255hp for pure driving pleasure. environmental standards as has added features to consolidate a drive under open skies, whatever Renault’s passenger cars. its leadership. the weather.

Twingo, the smallest minivan on the market – and still a pace-setter 10 years on.

Summary 4. Strength and innovation to meet customer needs 35 2002 Renault Annual Report The 1.9-liter dCi is Renault’s most versatile engine, with different versions generating from 80 to 120hp.

High-performance, low-emission engines

Renault regularly upgrades its ensure more effective control of with a new generation including multi-valve gasoline engines, from combustion, particularly at the in particular a six-speed manual the 1.2-liter 16-valve to the 3.5- pre-injection stage which in turn gearbox and a five-speed advanced liter 24-valve V6 – one of the makes for better performance, manual gearbox, as well as four- fullest ranges on the market and lower emissions and less noise. and five-speed Proactive auto- one of the most competitive in This is well illustrated by the 80hp matic transmissions with flick terms of output for consumption. 1.5-liter dCi unit equipping Clio, shift. The results speak for them- Environmental standards are a which generates only 113 grams selves, ensuring that both diesel priority for Renault, and in recent of carbon dioxide per kilometer and gasoline engines combine years we have made a special – setting the standard for this driving pleasure and low consump- effort to develop turbodiesel sector – as well as the 120hp tion, while complying with Euro 3 engines where we now offer an 1.9-liter dCi on Mégane II. (Euro 2000) emission standards. outstanding range. Latest develop- Transmissions have naturally been ments in common-rail technology another focus of development,

Renault F1 Team and made by Mike Racing under its own colors for the Gascoyne’s team at Enstone in the first time, Renault took a very honor- UK, plus completion of development able fourth place in the Formula 1 work on the V10 RS 23 engine at Constructors’ Championship behind Viry-Châtillon in France by Jean- Ferrari, McLaren Mercedes and Jacques His and his team. The Williams BMW. Our performance drivers are from Italy should improve significantly in 2003 and of Spain, who following upgrades on the chassis replaces Britain’s .

Driver Jarno Trulli with his team at the Spanish Grand Prix.

36 4. Strength and innovation to meet customer needs Summary 2002 Renault Annual Report A dependable presence

Renault’s response to new EU regulations for car sales

A new era began for the European quality criteria and limiting the present where needed and automobile market on October 1, number of such franchised dealers operates on a profitable, 2002, when new EU regulations in each country. permanent basis. came into force. Designed to harmonize prices and taxes in Dealers are still required to Since the new regulations overrule member countries by stages, these provide after-sales services but, many of existing contracts with will apply through to September in line with the new regulations, our dealer network, Renault is 30, 2010, starting with an initial they can now sub-contract this proposing replacement contracts transition period of one year. They area of business to another with terms approved by the represent a complete change in member of the network meeting Renault dealer group. Separate the traditional system of distribu- quality criteria defined by Renault. versions are being drawn up to tion by brand networks and thus meet legal requirements in in the relationship between This selective approach will different countries. manufacturers and dealers. In enable us to provide customers response, Renault is applying a with the support they expect, selective approach, requiring offering our products and services Speedy, professional service – Christophe Dorin with customer Florence Glasson distributors/dealers to meet through a brand network that is at the Renault Minute service center in Andelnans, France.

Renault expands web presence

Renault is the leading automobile in 2002. Altogether there are some brand name on the web in Europe, 20 websites representing the with over 45,000 visitors a day Renault brand around the world. “It is essential for us to maintain We currently require genuine Renault logging on in 2002. Sites offer direct links to customers to meet parts to be used for all repairs and customers a full range of informa- In the hotly disputed after-sales their repair needs effectively replacements under warranty or service tion on new and used vehicles sector, Renault is the first manu- – especially with the amount of contracts. In the future, we will have and accessories, as well as services facturer to offer e-commerce facili- electronic equipment now used in to make sure that customers have an such as service contracts and ties for the purchase of parts and cars. We have to be absolutely even clearer perception of the differ- financing. Those interested can accessories. certain that approved garages have ence between our replacement offer- contact distributors online to The Renaultp@rts site will go the skills and training to properly ing and others in terms of quality consider a purchase. online in 2003, serving major mar- understand all the technical docu- assurance and manufacturer’s warranty.” Using a common platform, kets across Europe. We expect to mentation we send them – Renault.SITe, e-commerce sites boost wholesale business for the as manufacturers, we must do target both international audiences Renault brand network through a everything we can to avoid the and markets in individual countries, rise in sales to other dealers and risk of technical failures. where they provide sales teams independent garage operators. Spare parts are the second key with powerful backup to consolidate By the same token, the site will issue. The new regulations have Daniel Rebbi customer relations. Full e-commerce enable Renault to consolidate links redefined the notion of genuine Director, Dealer offerings are now available in to our distribution network, which parts, and this will probably mean Network France, Germany and the UK, with is especially important in view of increased competition. Engineering Spain and Brazil added to the list new EU regulations on car sales. Renault

Summary 4. Strength and innovation to meet customer needs 37 2002 Renault Annual Report 2002 ranges

Vel Satis Espace

Avantime Laguna Laguna Sport Tourer

Mégane Hatch Mégane Sport Hatch Scénic

Mégane Cabriolet Mégane Clio

38 4. Strength and innovation to meet customer needs Summary 2002 Renault Annual Report Twingo Kangoo Car Kangoo Van

Trafic L2H2 Trafic Master

SM3 SM5

SupeRNova Pickup

Summary 4. Strength and innovation to meet customer needs 39 2002 Renault Annual Report Sustainable, responsible development

Acting globally and locally, Renault contributes to sustainable world development through economic efficiency, social responsibility, and environmental protection – reflecting our long-term commitment to good corporate citizenship, transparency and fairness.

At the Renault Technocentre – Delphine Bignon, responsible for paint finish and new body materials, and Christophe Becaert, a technician specialized in surface appearance, both members of the Painted Body Engineering department.

40 41 Professional expertise underpins strategy

Looking to the future: ...fostering an international recruiting the best corporate culture …and ongoing training

At Renault, growth and The world is changing and so is At Renault, we are convinced that In 2002, Renault s.a.s. spent the lasting business success Renault. In 2000 and 2001, we car- ongoing exchanges among the cul- equivalent of 5.8% of payroll on are backed by carefully ried out an exceptional recruitment tural groups represented within training (excluding government targeted recruitment and program to meet the human resource our corporation hold the key to rebates and subsidies). Programs skills management, challenges posed by the growing successful international expan- develop the professional skills combined with ongoing scope of our operations – and sion. This has led to a steady rise needed to cope in a changing envi- improvements in working cope, too, with swift changes in in our recruitment of non-French ronment and implement corporate conditions and active skills requirements and a fiercely managerial staff – up from 9% in strategy, while enabling partici- encouragement of inter- competitive world market. As a 1999 to 27% in 2001 and 36% in pants to acquire the expertise they cultural exchange based result, we hired over 4,500 new 2002. Step by step, we are forging need for a stimulating and satisfy- on mutual respect. employees worldwide in 2002, an international network to recruit ing career. This year distance more than 1,300 of them at the talent we need, starting with learning over the internet was par- Renault s.a.s. employment fairs and other joint ticularly popular, notably language Many applied through the jobs projects at leading universities courses to improve fluency in board on our corporate website and business schools in France English. www.renault.com, which displays and abroad. Our intranet also offered a range all openings, including those in We also offer internships to stu- of courses in each professional production, and we expect recruit- dents from around the world and area. ment to gather pace in 2003. to French students doing voluntary overseas service. To make our vision a reality, we have launched an in-depth review to identify the professional skills needed in the 10 years ahead. Results will be used in a variety of ways – to draw up short-term “Our new production way intro- young people recruited at Cleon over employment projections, identify duced standardized workstations. the past four years – an opportunity recruitment priorities, plan career It’s quite a challenge: operators are to develop genuine professional paths and develop training pro- trained by their BWT leader to han- skills. And if they demonstrate clear grams. All corporate departments dle not just their own job but those potential, they can even move onto a are involved. of two or three other team mem- management track.” bers. Under our new 100 career path program, unskilled workers can move up to the position of facility supervisor. New recruits Frédéric start at the receiving end, but as Banget they gain experience they take on Head of Gearbox more responsibilities, and can end Assembly up guiding others. The system gives Processes, promising candidates – and we’ve Cleon plant identified plenty among the 1,300 France

42 5. Sustainable, responsible development Summary 2002 Renault Annual Report Attracting and motivating talent – opening the way Management training

To develop long-term loyalty Management skills, Renault’s among its employees, Renault mainstay of success, came in for strives to provide a non-conflictual special attention in 2002, with environment in which everyone – nearly 3,500 people signing up for at whatever level – can make the a range of courses and seminars. most of his or her skills. We have The emphasis was on progress a long-standing policy of filling plans with managerial skills positions in-house whenever appraisal programs and individual possible, and we encourage coaching initiatives. moves from one country or Other options to strengthen manage- function to another. In 2002, ment practice covered team build- 787 employees took advantage ing, training managers in their of this policy, which favors the coaching role, management work- transfer of expertise and is also shops and the exchange of ideas an excellent means of promoting with management from other experts and young executives companies. with international potential. Through our intranet job board – Job@ccess to Renault – all employees have an opportunity to take their career in hand. Nearly 100 positions are posted and filled At the Renault Technocentre: Bruno Cébile, vehicle packaging engineer with fellow engineers Philippe Couret and Eric Quevilly. each month in locations around the world, representing a total of 3,150 jobs to date. “I studied economics in Sofia and conducting customer surveys. I wouldn’t mind working outside got a masters at the University of I’ve just joined the Product Planning France.” During the year, Renault s.a.s. put Central Europe in Budapest, then Department’s Range/Price/Volumes the finishing touches on a career- came to France under an EU unit, which means my next surveys path management system. Three exchange program for business will focus more on quantitative data. Krassimira agreements were signed, and new students. That was followed by a During my internship I got expert Iordanova degree courses were launched to six-month internship at Renault’s guidance and soon felt part of the Sales Projections, boost the number of in-house Brand Identity department, where company; we worked hard and I Light Commercial promotions to managerial status. I helped collect information for enjoyed the challenges. With a big Vehicles marketing briefs on two Mégane II company like Renault, there are lots Product Planning models – Scénic and Mégane of opportunities to broaden your Renault Coupé-Cabriolet – which involved horizons and acquire new skills. Technocentre

Summary 5. Sustainable, responsible development 43 2002 Renault Annual Report Professional expertise underpins strategy (cont.)

Keeping the lines Employee information of communication open

Well-being at work Renault is committed to keeping world rate our image, management, Renault is particularly keen on For Renault, improving employees’ all employees up to date on recent working conditions and workplace promoting consultation and quality of life is a priority and a key developments in business atmosphere. In 2002 Renault took empowering employees to help measure of our overall performance. performance, corporate strategy part in “Best Employers, Best the company move forward. In We start by ensuring a safe and and company-wide objectives. Results”, a pan-European business 2002 the role of the Central Works healthy working environment, which Information is relayed through survey comparing employee Council was strengthened and the includes making ergonomics a funda- print publications as well as a assessments of their employers’ select committee of the Renault mental consideration on the shop dual-language intranet with 60,000 image, and ranked among the top Group Works Council, the 36- floor. We also conduct regular check- terminals around the world. five outstanding employers in member body that represents ups of general health and monitor Two or three times a year, we also Europe. employees group-wide, met more cardio-vascular ailments and other commission an in-house survey frequently. In France, trade unions potential problems. Renault was one from a specialized consultancy to placed webpages describing their of the first companies in France to see how employees around the activities on the company intranet. set up a special medical unit to measure stress. Nearly 24,000 volunteers have already been tested, with individual and group recom- mendations issued as a result.

Bernard Deville and Humbert Tosarelli, line supervisors at the stamping unit of the Douai factory, France.

44 5. Sustainable, responsible development Summary 2002 Renault Annual Report Renault safeguards the environment

Renault applies strict procedures and methods to reduce the impact of its factories and vehicles on the environment and quality of life.

Factories that respect Eco-design – putting principles into practice the environment

Making environment-friendly vehicles standards of the product to be Renault first drew up an environ- The Ellypse concept car. means factoring environmental renewed, and, by the same token, mental management system for considerations into planning from identify areas for progress. vehicle production in 1995, and the the earliest stages of development results now speak for themselves. Site revitalization – to reduce or eliminate harmful Eco-design involves not only full Water and energy consumption is Renault sets the example effects. In recent years, Renault consideration of ecological factors declining steadily and emission of In 2002, Renault began a complete has conducted in-depth research at every stage in development but volatile organic compounds from clean-up to prepare for the urban into automobile-related environ- also a disciplined approach to paint has been halved. Similarly, redevelopment of 75 acres of land mental risk, and the results have ergonomics to enhance work-place the total weight of packaging – formerly its main factory site – served as a basis for the definition quality. Phasing in this approach waste has been halved in six years at Boulogne on the right bank of the of strict guidelines and procedures has required a significant commit- and 90% of the remainder can be Seine, just downstream from Paris. for environmental management. ment to training. By the end of recycled. All group factories are Decontamination work carried out by Achieving progress in this area 2002, 1,750 Renault engineers had now ISO 14001 certified with the specialized contractors will ensure has involved all Renault sites, with received eco-design training based exception of Renault Samsung full compliance with official contributions from suppliers and on the Cap-Eco package developed Motors and Dacia sites, where cer- instructions defining strict standards all those concerned with produc- in house, as had 400 experts from tification procedures are under way. of rehabilitation. Polluted soil and tion. In-house tools such as our 180 suppliers. These experts will concrete was the main focus of Recyclability Index and environ- now be taking charge of training operations, with eight to 10 truck- mental charters for factories in their own businesses and with loads carried away for treatment enable development engineers to their own suppliers. or disposal every day over a period rapidly assess the environmental of several months. Demolition and decontamination will take several more years and is currently expected to be complete in the course of 2007.

“We now have a harmonized in the product lifecycle, from environmental issues in the narrow approach to environmental purchasing to production and from sense to address the broader protection throughout the group. use to disposal. With these basic question of quality of life. Still, we Our policy is based on the principle principles and targets, we have been have to take a long-term view and that environmental protection is not able to build a network involving move ahead one step at a time. Alice de Brauer a separate issue, that instead it is people from all areas of business There is no point in being high- Director, part and parcel of all business operation and expertise in a shared handed – it takes time for these Environmental issues. We have set clearly defined commitment to environmental things to really sink in at every level Policy for targets to reduce or eliminate standards. This commitment has and bring about a change of Industrial Sites environmental impact at all stages quite naturally moved beyond corporate culture.” Renault

Summary 5. Sustainable, responsible development 45 2002 Renault Annual Report Ellypse embodies Renault’s commitment to sustainable development. In this all-new concept car, Renault has harnessed its creative skills to explore innovative solutions to reconcile the conflicting demands of mobility, vehicle comfort and safety features, manufacturing methods and environmental requirements. Cheerful and comfortable, Ellypse is a car for the city and the road. Its environmentally-friendly design uses advanced technology to deliver high performance and low emissions, with components that can be fully recycled at the end of its life. The project was also a management challenge in its own right, calling on the environmental expertise of in-house specialists and suppliers alike.

46 Renault and corporate citizenship

In addition to assuming its economic, social and environmental responsibilities to the full, Renault makes an active contribution to community well-being through initiatives in areas such as training and education, as well as participation in programs conducted by international organizations.

Road safety The Renault Foundation, established in cooperation with French and Japanese universities in March 2001, provides support for Since 2001, Renault has been Japanese students furthering their involved in the UN’s Global university studies in Europe. In 2002, Compact program encouraging it extended its scope with the launch businesses to take action to offset of the IP Fondation Renault MBA, the negative effects of globaliza- offered with the assistance of the tion. Participants report on results Sorbonne and Dauphine universities each year. At the World Summit on in Paris. The first 25 Japanese Sustainable Develop-ment held in students began the 12-month Johannesburg in September 2002, program, which also includes Renault chose to present its inter- courses in parts of Europe outside national educational program France, in July 2002. Safety for All. Reflecting the Children learn how to stay safe with the “Kids on the Road” kit, principles of responsible corporate circulated to primary schools. citizenship, this focuses on raising young people’s awareness of road safety through a competition, first Mobility for all Lifeskills launched in 2000, using the Kids on the Road kit developed in cooperation with teachers and road-safety specialists. Over Renault takes a special interest With its move into South Africa, 35,000 classes in nine European in the challenges of providing Renault became a local employer countries, representing a total of mobility for people in all parts and as such has a role to play in 1.7 million children aged seven to of the world and at all levels the country’s development. Since 11, participated in the 2001-2002 of society. Alongside major oil 2001, Renault South Africa has event, making it the most far- companies and other vehicle thus supported the Valued Citizens reaching of its kind ever seen in manufacturers, we participate program, teaching children in Europe. Through its European sub- in the Sustainable Mobility 2030 disadvantaged communities to sidiaries, Renault also provides program within the framework of know their rights and duties. training in preventive driving the World Business Council for Begun at 10 schools in Soweto safety. Sustainable Development. From and Alexandra townships with 2003 on, this will be generating 30 teachers assigned to some proposals for private and public 1,500 pupils, the program was transport options compatible with extended to a total of 100 primary the goals of sustainable develop- schools in the Johannesburg area ment. In a similar vein, Renault in 2002 and a pilot project is contributes to a number of planned for KwaZulu-Natal initiatives in developing countries, Province. including the Massachusetts September 2002. At the World Summit on Sustainable Development in Johannesburg, Louis Schweitzer talks to pupils participating Institute of Technology’s Coopera- in the Valued Citizens program. tive Mobility program in Brazil, Mexico City, Santiago de Chile, and urban areas of China.

Summary 5. Sustainable, responsible development 47 2002 Renault Annual Report Looking ahead

Finance Products

(Approved by the Board of Directors Renewal of the Renault lineup will A minivan-inspired Trafic Minibus meeting of February 11, 2003). continue at a swift pace in 2003, will be rolled out towards summer. with five new Mégane II body types Drivers can choose from one At this point in time, Renault is unveiled, bringing the family total gasoline and three diesel engines, expecting a slight downturn in to seven in all. with the new 135hp 99kW 2.5-liter 2003 in the automobile market in dCi 16-valve unit available across Europe and a slight upturn in the Newcomers are the Mégane the Trafic range. main countries in which the group Coupé-Cabriolet, two Scénics operates outside Europe. On the – a compact and a long version, A wider choice of automatic basis of this assumption, Renault the latter with seven full-size transmissions will also be is targeting higher revenues in seating positions – the Mégane available, with the five-speed 2003 than in 2002 and an oper- Sport Tourer and the Mégane Proactive transmission used for ating margin of around 4% of sedan. four- engines equipping revenues. top-of-the-line models including New Kangoo has a stronger the Vel Satis 2.0-liter T and 2.2-liter However, given the uncertain eco- design with all of the personality dCi, Espace IV, the Avantime nomic environment, a sharper and appeal of the existing model, 2.0-liter T, and Laguna. decline in the automobile market plus a marked improvement in cannot be ruled out. Renault con- perceived quality with a stylish siders that it has key strengths to new dashboard and greater comfort. cope with the situation: in particu- lar, after the introduction of the Mégane II Hatch at the end of 2002, Renault will benefit in 2003 from the ongoing renewal of the Mégane family with the launch of four new models including Scénic II in the summer. The impact of these new models will be signifi- cant as of the second half of the year. Further, the group will pursue its cost-reduction efforts and con- tinue to act responsively.

A new boost for Kangoo, Europe’s best-selling purpose-built small van, now restyled and powered by the new 1.6-liter 16V engine with .

48 Looking ahead Summary 2002 Renault Annual Report A compact and dynamic design, sedan-style driving pleasure and two body lengths for Scénic II.

Elegance, performance, four full-size seats and the first folding metal/glass roof for the Mégane Coupé-Cabriolet.

The Solenza, the first model in the renewal of the Dacia lineup, epitomizes the brand's new visual identity.

49 / Blanchard Printing DREAM ON design:

RENAULT 13-15, quai Le Gallo 92513 BOULOGNE-BILLANCOURT Cedex France Tel.: + 33 (0)1 41 04 50 50 www.renault.com

INVESTOR RELATIONS DEPARTMENT CORPORATE COMMUNICATIONS DEPARTMENT

Photo credits:

O. Banet: p. 38 Anthony Bernier: front and back cover, pp. 18-19, 49 Stéphane de Bourgies: pp. 26, 37, 42, 43, 45 Alex Chatelain: pp. 4-5 Claude Cugny: pp. 38-39 Patrick Curtet: p. 46 Hervé Desdemaines (Studio Pons): pp. 32-33, 37 Dingo: pp. 10-11, 20, 34, 35, 48 Dominique Dumas: pp. 24, 36, 39 D.P.P. I .: p. 36 Harry Gruyaert (Magnum): pp. 9, 22, 31 Christophe Lebedinsky: p. 27 Michael Lewis: p. 13 Xavier de Nombel: p. 21 Christian Occhipinti: p. 39 Chris Overton: p. 7 Photothèque Dacia: pp. 23, 39 Photothèque Nissan: p. 9 Photothèque RSM: pp. 23, 39 Philippe Pons (Studio Pons): p. 44 Patrick Sautelet: pp. 9, 23, 29, 39 Philippe Stroppa (Studio Pons): front cover (Alexandre Plaud, surface treatment validation testing expert), pp. 26, 40-41, 43 Hubert Vincent: p. 36 Michel de Vries: pp. 16, 21, 34, 35 4939 213 471 GB