renault board presentation

1

For internal use only

Renault Franchise analysis

Feb 2009

Confidential

2


Contents• Market Analysis• Renault Overview

– History and Financial Situation– Current Product Range– Future product range– Renault Strategy Worldwide and Support for GCC

• Why Renault franchise for Alissa• Task force Result• ConclusionConfidential

3


Market trend in Saudi Arabia

• Small cars trend is growing in the last 2 years by 16% .

• The market leader in Passenger car sector is 2.4cc engine cars “Camry alone sold 47,108 units in 2008.”

• It will come a day that female will be allowed to drive and Subcompact and Compact car will be the first choice for this segment

Confidential

4


Company overview

Confidential

5


Company History• Renault motor works has started during the last weeks of 1898.• 1904 - Renault is developing its business net which had 120 dealers at the time. Production

reached 948 cars.• 1906 - The first Renault bus.• 1959 - Renault car company became the world`s 6th biggest car producer.• 1991 - A new model, Clio• 1992 - Renault Safrane• 1994 - Production of Renault Laguna started.• 1995 - Production of Renault Megane started.• 1996 - Production of a revolutionary Renault Scenic started. "The car of year 1997• 1999- Renault-Nissan Alliance• 2000: Renault acquired the automotive division of Samsung automobiles.• 2002- Renault increases its stake in Nissan to 44.4%.

In 2008, Renault celebrated 110 years of existence. We look back at more than a century of history with a few key dates.

Confidential

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6

STRUCTUREFOUR BRANDS, ONE PARTNER AND ONE ALLIANCE

THE BRANDS

THE ALLIANCE

DACIA RENAULT RENAULT SAMSUNG MOTORS

AvtoVaz (LADA)

ONE STRATEGIC PARTNER

http://www.adgoog.com/blog/photo/12437a-automobile_le_russe_avtovaz_hesite_entre_renault_et_fiat.jpg

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7

RENAULT SA

NISSAN MOTOR

RENAULT s.a.s.

DACIA

Other commercial, industrial & financing companies

MAHINDRA RENAULT (India)RENAULT PARS (Iran)

AVTOFRAMOS (Russia) ...

44.3%

100%

99.4%

100% 80.1%

RCI BANQUE

RENAULTSAMSUNG MOTORS

AB VOLVO

21.8%

STRUCTURE SIMPLIFIED STRUCTURE OF THE RENAULT GROUP

AvtoVAZ

25.01%

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8

STRUCTURERENAULT SHAREHOLDERS

Employees3.11%

Public & institutional investors64.23%

At December 31, 2007

Company-owned (1) (2)

2.65%Nissan (2)

15.0%

(1) Shares required for the purposes of stock option programs(2) Those shares have no voting rights attached for Board of Directors meetings

French State15.01%

9


Carlos GHOSNPresident & CEO

Patrick BLAIN EVP, Sales & Marketing

Regional Leader Europe

Patrick PÉLATA EVP, Plan, Product &

Programs

Thierry MOULONGUETEVP, Finance

Regional Leader Americas

Jean-Louis RICAUDEVP, Engineering

& Quality

Michel GORNETEVP, Manuf. & LogisticsRegional Leader France

MANAGEMENTEXECUTIVE COMMITTEE

Katsumi NAKAMURA*Regional Leader Asia Africa

* From May 5th 2008

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10

ALLIANCECAPITAL STRUCTURE

(1) No voting rights

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11

Renault Nissan

0 2 4 6 8 10

Mitsubishi

BMW

Suzuki

Fiat

Chrysler

PSA

Hyundai Kia

Honda

VAG

Ford Mazda

GM

Toyota 9.1

8.7

7.7

6.2

6.2

3.9

3.4

2.6

2.5

2.3

1.5

1.4

3.72.5

ALLIANCE: THE WORLD’S 5th BIGGEST MANUFACTURER

3.8

Million vehicles sold in 2007

12


Renault Now• Renault is now present in 118 countries• Group sales worldwide: 2,484,472 vehicles (year 2007)• 35% of the group sales are made outside Western Europe• Revenues for the year 2007: €40,682 million• A workforce of 127,483 employees (first semester 2008)• 100% of Renault industrial sites are now ISO 14001

certified• The leading automobile brand in France (23.5% of the

market in volume)• Renault: 10 years as the leading LCV brand in EuropeConfidential

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13

THE CURRENT RENAULT RANGE

Laguna

Clio ModusScénic

Espace

Passenger Cars

Kangoo*

Trafic PC Thalia / SymbolLogan

Mégane

Clio Campus

Vel Satis

Twingo Clio Grand Tour*

Laguna Estate* Koleos*

Sandero

* Start of Sales in early 2008

Estate Sedan

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14

Light Commercial Vehicles (LCV)

Light Commercial Vehicles (LCV)

Kangoo Express* MasterTrafic LCV

* Start of Sales in early 2008

15


15Phase 2 + Derivatives

World Premiere vehicles in 2007

Asia Africa

11Americas

6

France

13

Europe

14 12Euromed

2008 PRODUCT LAUNCHES BY REGION

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PRODUCT PLANNING GCC 20092008 RANGE 2009 RANGE

CLIO CLASSIC

CLIO RS CLIO RS

LOGAN MT LOGAN MT FULL YEAR

SYMBOL SYMBOL FULL YEAR

LOGAN AT

SANDERO

MEGANE HATCH MEGANE HATCH

MEGANE SEDAN MEGANE SEDAN

MEGANE CC MEGANE CC

D SEGMENT SAFRANE SAFRANE FULL YEAR

LAGUNA COUPE

SUV SEGMENT KOLEOS

KANGOO KANGOO

TRAFIC TRAFIC

MPV SEGMENT LOGAN MCV

B SEGMENT

C SEGMENT

LCV SEGMENT

Factory

France

France

Romania

Turkey

Romania

Turkey

Turkey

France

Korea

Korea

France

France

Romania

17


Price list

Confidential

Model Seg FOB $ Freight $ C&F $ Ins (1%) CIF $ CIF SR Cust (5%) Clearance Land Cost Selling @ 10% Selling @ 15%

Logan PE M/T B 6,644 750 7,394 74 7,468 28,005 1,400 140 29,545 32,500 33,977

Logan PE A/T B 7,394 750 8,144 81 8,225 30,845 1,542 140 32,528 35,780 37,407

Logan SE M/T B 7,304 750 8,054 81 8,135 30,505 1,525 140 32,170 35,387 36,995

Logan SE A/T B 8,054 750 8,804 88 8,892 33,345 1,667 140 35,152 38,668 40,425

Symbol PE B 8,675 750 9,425 94 9,519 35,697 1,785 140 37,622 41,384 43,265

Symbol SE B 9,955 750 10,705 107 10,812 40,545 2,027 140 42,712 46,984 49,119

Clio sport B 18,200 750 18,950 190 19,140 71,773 3,589 140 75,502 83,052 86,827

Clio sport F1 B 17,100 750 17,850 179 18,029 67,607 3,380 140 71,127 78,240 81,796

Megane Coupe sport C 19,600 780 20,380 204 20,584 77,189 3,859 140 81,189 89,308 93,367

Megane Coupe D C 18,380 780 19,160 192 19,352 72,569 3,628 140 76,337 83,971 87,787

Megane Coupe EX C 19,496 780 20,276 203 20,479 76,795 3,840 140 80,775 88,853 92,891

Megane Sedan D 1.6 AT C 12,000 780 12,780 128 12,908 48,404 2,420 140 50,964 56,061 58,609

Megane Sedan D 2.0 AT C 12,950 780 13,730 137 13,867 52,002 2,600 140 54,742 60,217 62,954

Megane Sedan P 2.0 AT C 14,000 780 14,780 148 14,928 55,979 2,799 140 58,918 64,810 67,756

Megane Sedan A 1.6 MT C 10,100 780 10,880 109 10,989 41,208 2,060 140 43,408 47,749 49,920

Megane Sedan A 1.6 AT C 11,000 780 11,780 118 11,898 44,617 2,231 140 46,988 51,686 54,036

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Price list

Confidential

Model Seg FOB $ Freight $ C&F $ Ins

(1%) CIF $ CIF SR Cust (5%)

Clearance

Land Cost

Selling @ 10%

Selling @ 15%

Koleos PE 4x2 SUV 15,575

803

16,378

164

16,542

62,032

3,102 140

65,273 71,801

75,064

Koleos PE 4x4 SUV 16,860

803

17,663

177

17,840

66,899

3,345 140

70,384 77,422

80,941

Koleos SE 4x2 SUV 17,015

803

17,818

178

17,996

67,486

3,374 140

71,000 78,100

81,650

Koleos SE 4x4 SUV 18,355

803

19,158

192

19,350

72,561

3,628 140

76,329 83,962

87,778

Koleos LE 4x4 SUV 19,910

803

20,713

207

20,920

78,450

3,923 140

82,513 90,764

94,890

Safrane PE D 12,695

803

13,498

135

13,633

51,124

2,556 140

53,820 59,202

61,893

Safrane SE D 14,707

803

15,510

155

15,665

58,744

2,937 140

61,821 68,003

71,095

Safrane LE D 16,138

803

16,941

169

17,110

64,164

3,208 140

67,512 74,263

77,639

Kangoo Express LCV 8,063

803

8,866

89

8,955

33,580

1,679 140

35,399 38,939

40,709

Trafic LCV 14,402

803

15,205

152

15,357

57,589

2,879 140

60,608 66,669

69,700

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Notes on Pricing– Renault Safrane competes in the largest market in

PC sector starting from 59,000 SR.– Koleos first cross over 4x4 from Renault “Nissan

Technology” Starting from 71,800 SR. • Additional 1000-1500 USD reduction in Fob price is

being studied now.– New Logan (1.6 cc) starting from 32,500 SR,

• Price will be revised soon.– LCV for fleet customer starting from 38,900 SR

Confidential

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20April 24th 2008PRODUCT PANEL 02STRICTLY CONFIDENTIAL

KOLEOS LE « March/April 09 »

21

For internal use only Koleos

Confidential

Model PE 4x2&4x4 SE 4x2&4x4 L-E 4x4 (privilege)

Engine Type 2.5 16 V 2WD /4WD 2.5 16 V 2WD /4WD 2.5 16 V 2WD /4WD

Transmission CVT (Continuous Variable Transmission)

ABS, Air bag, PS, ST ST ST

Front and Rear parking sensor

yes

Fog lamps, Auto light, spoiler ST ST

Radio, CD , jack PlugST ST ST + 9 speakers and

cd changer

Cruse Control yes

Warranty 3years/100.000KM 3years/100.000KM 3years/100.000KM

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Item Rav4 Captiva Santafi Koleos

Engine 4 cylinder 4 cylinder 4 cylinde 4 cylinde

Power output 168 141 185 175/6000

Engien size 2362 2.4 2.7 2488

Transmission 4 speed A 4 speed A 4 speed A CVT

Price 77,000Full 97,000 79,000 78,000

Full 93,000 71,800

Full 78,100After pr reduction 66,175

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Renault-Safrane

Confidential

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Renault New SafraneModel Safrane 2.0 AT Safrane 2.3 AT SE Safrane 2.3 AT LE

Engine Type 4 Cylinder 6 Cylinder 6 Cylinder

Power out 143hp 170hp 170hp

Engine Size 1998cc 2349cc 2349cc

Transmission 4 Speed AT 5 Speed AT 5 Speed ATABS, Air bag, Security with alarm ST ST ST

Rear parking sensor yesFog lamb, 16” Al alloy wheel, and spare ST ST ST

6 CD changer ST ST ST + 7 speakersKey less entry ST ST STWarranty 3years/100.000KM 3years/100.000KM 3years/100.000KM

Confidential

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Confidential

Item Camry Accord Mazda 6 ultra Sonata Safrane 2.0 Safrane SE Safrane LE

Engine 4 cylinde 6 cylinder 4 culinder 4 culinder 4 cylinder 6 cylinder 6 cylinder

Power output 157 hp 178/6500 125/6000 127.9/6000 143 170/6000 170/6000

Engien size 2362 cc 2354 cc 2488 cc 2359 cc 1998cc 2349 cc 2349 cc

Transmission 5 speed A 5 speed A 5 speed A 5 speed A 5 speed A 5 speed A 5 speed A

16" Al alloy wheels no yes yes yes Yes yes yes

Price 82,000 84,000 99,000 Start from 62,000 59,202 68,000 74,000

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2010 New D Segment Sedan (Safrane New Models)

Launch: December 2010

Indicative Price : 17-26 k$

Engine :

2.0 l 16v AT(cvt) 140 hp 2,5 l V6 AT6 170 hp3,5 l V6 AT6 240 hp

Specific product advantage :

First Renault D segment sedan

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LOGAN SEDAN « Lunch in April 09 »

Engine : 1.6 l 16v AT4 110 hp

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SYMBOL

• 2 models PE and SE• 1.4 16 V 4 speed Auto engine• To be launched

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SANDEROLaunch :Dec 2009

FOB:from 11k$

Engine :1.6 l 8v MT5 90 hp1.6 l 16v MT5 104 hp1.6 l 16v AT4 104 hp

30


Item Jazz Getz Aveo Yaris Yaris Sirion Logan PE Logan SE Symbol

Engine 4 cylinde 4 cylinde 4 cylinder 4 cylinder 4 cylinder 4 cylinder 4 cylinder 4 cylinder 4 cylinder

Power output 118/6600 69.9(95)/6000 94 85/6000 85/6000 67/6000 110 110 72/6000

Engien size 1496 cc 1399 cc 1.4 1298 cc 1298 cc 1298 cc 1600 1600 1390

Transmission 5 Speed A 5 Speed M 4 speed A 4 speed A 5 speed M 4 speed A 4 speed A 4 speed A 4 speed A

Price 65,400 34,500 43,000 From 41,000 to 52,000 43,750 35,700 38,630 41,300

31


Renault MEGANE

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Confidential

Item Tiida 1.6 Corolla Corolla 1.8 Civic LX Mazda 3 Optra Megane D 1,6

Megane D 1,6

Engine 4 cylinde 4 cylinder 4 cylinder 4 cylinder 4 cylinder 4 cylinder 4 cylinder 4 cylinder

Power output 109(118)/6000 107 130 138/6300 107/6000 107 115/6000 115/6000

Engien size 1598 cc 1600 cc 1800 cc 1800 cc 1600 cc 1.6 1600 cc 1600 cc

Transmission 5 Speed M 5 speed M 5 speed A 5 speed A 4 speed A 4 speed A 4 speed A 5 speed M

Price from 54,850 to 59,850 from 53,000 to 76,000 67,900

Full option 63,000 "model

2008"50,000 56,000 51,600

Megane Has Keyless entry, six air bags, ABS and Other advanced options.

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Confidential

Item Mazda 6 Normal Epica Lancer GT Megane A 2.0

Engine 4 cylinder 4 cylinder 4 cylinder 4 cylinder

Power output 108/6500 144 114(155)/6000 136/5500

Engien size 1998 cc 2.0 1998 cc 1998 cc

Transmission 4 speed A 4 speed A 6 CVT/5 sp M 4 speed A

Price 69,000 66,000 75,600 60,217

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NEW MEGANE in 2010

New Megane Sedan/HATCHLaunch: April 2010

Estimated FOB: 12-17 k$

Engine :1.6 l 16v MT5 110 hp1.6 l 16v AT4 110 hp 2.0 l 16v MT5 150 hp2.0 l 16v AT (CVT) 150 hp

Specific product advantage : Rear AC exit.

New MEGANE RSLaunch:beg 2009

MSRP : 28 k$Engine :

2.0 l 16v Turbo MT6 250 hp

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Kangoo and Trafic

Confidential

New Kangoo LL wil be launched in May/June 2009

Renault Trafic: 66,700 SRToyota Hiace: 74,500 SRNissan Urvan: 72,000

- Extra $ 1500 price reduction

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Confidential

Item Kangoo Partner "Peugeot" Perlingo "Citroen"

Engine 4 cylinde 4 cylinde 4 cylinde

Power output 75 110 75

Engien size 1.4 1.6 1.4

Transmission 5 speed M 6 speed M 5 speed M

Price 2008: 39,9002009:42,900 2008: 48,000 40,000 "2008"

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Megan Coupe 2009

Confidential

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Laguna Coupe 2009 “May/June 09”

Confidential

SOS: September 2009

Engine :

3,5l V6 AT6 240 hp

39


Clio 2009

Confidential

40


LOGAN MCV « Q3 09 »

Launch :September 2009

FOB:12 200 $

Engine :

1.6 l 16v MT5 115 hp1.6 l 16v AT4 115 hp

41


2011 New Entry SUVLaunch :Feb 2011

Indicative volumes : 750 units

Engine :1.6 l 16v MT5 FWD 110 hp1.6 l 16v MT6 4WD 110 hp1.6 l 16v AT4 FWD 110 hp2.0 l 16v AT4 FWD 140 hp2.0 l 16v MT6 4WD 140 hp

42


LOGAN PICK-UP

43


Euro NCAP “safety assessment”

Confidential

• More than 10 models acquiring 5 stars in safety assessment from Euro NCAP

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Euro NCAP “safety assessment”

Confidential

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Confidential

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Confidential

47


Qualitative research• This research is based on random selection of Renault users

whom were asked about the overall performance and their opinion about Renault– Renault Megane Coupe 2009 “the driver is Prince/ Mohamed Bin

Bander” fully satisfied with the performance and the design, his companion has a Safrane and he said it is a nice car with a lot of options, at convenient price.

– Renault Megane“ he is using it for 4 years now, he is satisfied with the performance, while he faced some problems in service and expensive spare parts.

– Renault Clio “the customer is using it for 3 years now, with no major problems at all, he is claiming high spare parts prices compared to Tunisia.

Confidential

48


Renault Global Strategy

• Three strong commitments – Quality– Profitability– Growth

Renault offers its 3 year/150,000 km warranty* for the entire Renault premium range.

Confidential

* In Saudi Arabia 3 years/100,000 Km warranty

49


Objectives• renewal of the existing product range• reinforcement of the luxury offer• innovation in markets where Renault is not yet

present• Development of international sales

– expanding the product range and designing vehicles for specific markets

• Optimize R&D spending to design vehicles that are increasingly environmentally-friendly

Confidential

50

For internal use only GCC PLAN 2012 VOLUMES

2149 3600 8640 19490 24450 27300TOTAL

0

5000

10000

15000

20000

25000

30000

2007 2008 2009 2010 2011 2012

L90 L38 L43 SM5 Other models

51


QUALITYTo be among the top three in terms of product and service quality

PROFITABILITYAchieve an operating margin of 6% in 2009

GROWTHSell an additional 800,000 vehicles

52


• Products • Continuous improvement of the quality of the vehicles• Vehicles designed for the GCC & systematically tested in the GCC• Direct link between Technical Hub (Dubai) and the incident logy

department

• Services • Spare parts price & availability• Quality survey conducted every month• Training• Renault Excellence program & Peace Of mind package

QUALITY AND PARTS ACTIVITIES

53


Why Renault Franchise for Alissa• Long history backed with high quality products.• New LCV range will support our current profile “Isuzu”• Complete our range of products by adding PC and new

LCV series.• Wide range of PC from 1.3 cc to 2.5 cc.• New Models from Korea plant (Samsung automobile)

“Koleos and Safarane” characterized by:– Specially designed and tested for GCC– High Quality products “Nissan Technology”.– Competitive prices

Confidential

54


Why Renault Franchise for Alissa• New city car Models from Turkey and Romania plants

“Logan, Symbol, Sandero” • Exclusive distributor in Saudi Arabia. Which will help in

achieving good margin profit and receiving effective support from the manufacturer to achieve big sales volume.

• New models are planned to be launched within the next 3 years.

• Aggressive expansion plan from the manufacturer to rebuild the brand image in GCC region and expand sales volume within the next five years.

Confidential

55


Key challenging Issues

• Low resale value.• The perception in the market especially for

Service and spare parts “currently is very bad”.• Perception of high prices spare parts and non-

availability.• Technical issues regarding its convenience for

GCC environment.• European vehicles image.

Confidential

56


Current Renault Situation in KSA• Al Zahid Started his interest in Renault franchise since 2001 after

Daewoo franchise is sold to GM.• The first fleet team was established in 2002• The first Dedicated showroom in Riyadh was established in 2004,

and in Jeddah in 2007.• No focus on brand image or marketing activities.• Fleet business represents 60-70% from their current sales.• Total 7 workshops around the kingdom For all AL-Zahid franchises

“Not dedicated for Renault”.• Lack of Parts availability.• Parts pricing structure was not based on market “according to

Renault director”

Confidential

57


BRAND AWARENESS : KSA Survey :

1

25

57

0

10

20

30

40

50

60

Top of mind Total Unaided Total (aided andunaided)

2

69

95

0102030405060708090

100

Top of mind Total Unaided Total (aided andunaided)

2007 2008

A Renault Brand awareness survey was conducted by IPSOS towards 500 people in Saudi Arabia end 2007 then in September 2008

58


How to support product awareness in the market?

• In cooperation with manufacture the first step will focus on “The Time of Change in Renault” through heavy launching marketing activities.– Communicating the new “Peace-Of-Mind” service in the

market. “already available since sep. 08 but not yet launched”.– Renault “customer first” program for service and spare parts.

• Aggressive launch of the new models “Safrane, Logan and Koleos” – Focus on High quality products “Recent technology”– GCC tested.

Confidential

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How to improve after sales service and spare parts availability / prices?

• Communicating the 3 years warranty or 100,000 Km for all products range.

• Renault will support technically and financially the creation of the workshops Exterior & Interior , through their technical support team in Dubai office.

• Utilizing the group service centers to enhance the after sales service of Renault.

• Restructure the parts prices by the support of the manufacturer to make it and keep it competitive.

Confidential

60


“RENAULT CUSTOMER FIRST” program launched in the GCC Sep 08

PEACE OF MIND PACKAGE

11-POINT CONFIDENCE COMES STANDARD IN EVERY RENAULT

1. 100km test drive invitation

2. Initial 1000km free inspection

3. Always mobile service: courtesy cars / taxi vouchers

4. 24/7 Roadside Assistance

5. 3y / 100 000 km car warranty

6. Exclusive use of Renault Genuine Parts

7. 1y warranty for maintenance or repairing

8. Maintenance appointment within 48H

9. Quality Certificate after each repair or maintenance

10. Competitive fixed service prices

11. Dedicated Customer line

61


Market Segmentation

1. Fleet Customer– Success Factors:

• Our long experience in this sector and strong relationship with decision makers.

• Wide range of products with competitive prices.• New LCV Range to support our current range of products.• Fleet support from manufacturer more than 5 units:• Safrane $ 600• Logan $ 300• Others $ 200

Confidential

62


Market Segmentation

2. Rent-A-Car companies• Objectives to ensure success:

– Increase incidence of trial new models through Rent-A-Car companies.

– Focus on LCV, Logan, Symbol and Safrane to gain sizable market share in big volume segment available for rent.

Confidential

63


Market Segmentation3. Retail customers• Increase the retail share in the total sales volume by:

– 3 dedicated room in 3 main cities.– Utilizing some spaces at Isuzu showrooms and sister companies

sales centers.– Renault will support architecturally and financially the creation of

the showrooms Exterior & Interior– Customer First Program launch “Peace of Mind”.– Improve company image by New Megane Coupe and Laguna

Coupe.– By support of Renault, launching “Trade In” program to enhance

the resale value for Renault Vehicles.

Confidential

64


AACO and sister companies• Synergy between AACO and sister companies will

have a great impact on the franchise success through:– Renault provides a wide range for rent car business within

the group.– Financial facilities for retail and fleet customers through Al

Yusr.– Increase service and parts revenue in cooperation with

Autostar– Used car sector helps in leveraging the low resale value of

the brand.

Confidential

65


Confidential

Thank you

renault board presentation

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