Moody's shifts Renault outlook to stable

Moody's Investors Service said it changed the outlook on Renault SA's ratings to stable from negative. Concurrently, Moody's affirmed the Ba2 corporate family rating the Ba2-PD probability of default rating, the (P) Ba2 rating of the group's senior unsecured EMTN program and the Ba2 ratings of the group's senior unsecured notes.

"The outlook change to stable reflects Renault's improved profitability in the first half of 2022, and the expectation of further improvements driven by the execution of the strategic plan Renaulution," said Matthias Heck, a Moody's vice president, senior credit officer and lead analyst for Renault, in a press release.

Additionally, in September, Moody’s changed its outlook for the global automotive industry reflecting a softening macroeconomic environment and weakening consumer demand, pushed by high price inflation and higher interest rates.

The agency said it sees the stress on global supply chains improving but continuing. However, Moody's projects Renault will profit from a volume recovery in its key markets, which previously underperformed, and should be able to improve its metrics within the next 12-18 months compared to still low current levels.

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