Page last updated at 11:30 GMT, Thursday, 12 February 2009

Renault sees 78% fall in profit

Renault Megane
Renault said its original targets for 2009 were now "unachievable"

French carmaker Renault has reported a steep fall in profit and abandoned its targets for 2009, blaming an economic crisis "of massive proportions".

The company announced a net profit of 599m euros ($769m; 541m) for 2008, down 78% on the previous year.

Worldwide sales fell by 4%. Sales in Europe were down more than 7%.

Renault said it expected market conditions to worsen and added that its volume and operating margin targets for 2009 were now "unachievable".

'Profound crisis'

The company said it had a single priority for the year ahead - to aim for positive free cash flow.

The car industry has been hit by a slump in demand amid a wider economic slowdown.

Industry-wide new car sales in Europe fell 17.8% in December.

"The crisis facing the automobile industry is profound," said Renault chief executive Carlos Ghosn.

"It risks being long and without doubt will change the industrial landscape."

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