And if it was him ? One thing is certain: the challenges that await Luca de Meo from July 1, when he will sit in the CEO's chair on the seventh floor of Renault headquarters, in Boulogne-Billancourt (Hauts-de-Seine), are colossal. A good part of the 48,000 employees of Renault in France had however sworn to no longer base their hopes on a single man.
“It is not expected like the messiah, confided to us a senior manager of Renault last January. Messiahs, we had our dose! And yet, the announcement of the appointment of this charismatic Italian, ratified at a board of directors on January 28, caused a breath of hope. That of finally being able to turn the page of the Ghosn era, symbol of an autocracy, a nepotism and a cult of personality taken to the extreme.
A "marketing ace" that has enhanced the image of Seat
A wind of hope and a frustration too. At the end of January, in the middle of the Davos World Economic Forum, Jean-Dominique Senard, said he hoped for the arrival of his new right hand "in the coming days". It finally took the president of Renault to wait five months, despite the urgency, for Luca de Meo to serve an extended non-competition clause, known as "garden leave", imposed by Volkswagen, his previous employer.
The bright 52-year-old Transalpine grew up in the small village of Locorotondo, near Bari, in Puglia. Very early on, his parents left the small family home (which de Meo would buy years later) to look for work in the North. He went through the prestigious Bocconi University in Milan, wrote a dissertation on business ethics, made his debut in 1992 at Renault (already), then Toyota six years later.
In the 2000s, he became the sales manager for Lancia, Fiat and Alfa Romeo. Then marketing director at Volkswagen and Audi. But it is indeed his four years as President of Seat that will definitively establish his reputation. He made a spectacular comeback in favor of the Spanish brand, long the lame duck of the German group, by increasing sales by 20%. Since then, Seat has returned to the green, breaking new records every year, even making the best profits in its history (254 million euros, or + 33% in one year) in 2018.
"De Meo has been to Seat what Carlos Tavares is to PSA", says even one of his former collaborators, who has since moved on to a competitor. "A marketing ace," says another. He demonstrated it at Volkswagen, as before at Fiat, where he knew how to restore to the 500 [ Editor's note: relaunched in 2007 ] its luster of yesteryear, drawing inspiration from what BMW had achieved with the new six generation Mini years earlier. Result: like the British icon of the 1960s revisited in a “neo-retro” way by the Germans, Luca de Meo made the new Fiat 500 as much a fashion accessory as an automobile. With the margins of the luxury industry, since the 500 "revisited" costs only a few hundred euros more to manufacture than a vulgar Panda but on the other hand sells from 1,000 to 1,500 € more expensive. Any constructor's dream.
A manager open to dialogue
The objective of the non-competition clause imposed on Luca de Meo will therefore have been to prevent the former Volkswagen employee from disclosing any strategic information for at least a few months. In an ultra-competitive environment, car manufacturers have the (often justified) phobia of industrial espionage. A delay which will also have enabled Luca de Meo to develop his weapons and his strategy to face, as new captain, the storm which shakes the Renault ship from all sides. And incidentally to organize the move of his small family, his wife Silvia (met in Bocconi) and his twins Giulio and Matteo, from their house in Martorell, a small town on the outskirts of Barcelona where the brand's main factory is located, as well as most of its 11,000 employees.
Only a few days left now. But that time will have seemed long. Jean-Dominique Senard gnawing his brakes, eager to be able to rest a little on his new right arm, facing the enormous workload that awaits them. "I think Luca de Meo is exactly what Renault needs today," the group's president told us on May 29 in an interview.
“It pays me” newsletter
The newsletter that improves your purchasing powerI'm registering
Your email address is collected by Le Parisien to allow you to receive our news and commercial offers. Find out more
In addition to having made his debut at Renault, he is an extraordinary manager, with many successes to his credit, and solid experience, acquired with prestigious brands. From experience, it will indeed be necessary to face the consequences of the disastrous balance sheet of 2019, "annus horribilis" for Renault resulting in a 3.4% drop in its volumes, to 3.75 million vehicles, generating a net loss of 141 billion euros. Unheard of since the last economic crisis in 2009. Not to mention the coronavirus pandemic, which pushed the group to shut down its factories and to temporarily close its concessions.
Its mission: to federate after the Ghosn affair
"The rant to assert his authority, it's really not his thing, resumes this former collaborator, cited above. He prefers to sit down by drawing on his very extensive experience in the sector, to argue with his interlocutor. He knows what he wants but he takes the time it takes to explain it. "A dialogue that he imposes in no less than five languages: Italian of course, but also English, German (learned in less than a year through intensive courses, when he returned to Volkswagen), Spanish and French (he spent part of his childhood in Côte d'Ivoire).
This polyglot certainly does not have, like Carlos Ghosn, three passports in his crossed jacket but has lived in a dozen countries. And he likes nothing so much as speaking the language of his interlocutor. Even if it means repeating yourself several times to make yourself understood, rather than switching easily to business English. "And if he has the impression that the message has still not got through, he does not hesitate to accompany his remarks with small diagrams sketched on a corner of the table," says a colleague, who stayed with him at Seat. Besides, originally, he wanted to be an automotive designer. He kept his passion for drawing. "
Luca de Meo has many passions: sports cars, of course; but also padel, a racket sport derived from tennis, widely practiced in Latin countries; collectors' watches and… electronic music. "He does not organize sumptuous evenings in palaces at the expense of the princess, but has his little bling-bling side, confesses this same colleague. He has his suits cut to measure, and likes to sit behind the wheel of a Lamborghini or a Porsche. "
It prevents. Jean-Dominique Senard relies on his recognized ability to federate to stimulate a new dynamic. “He has the intelligence to empower his teams, rather than acting on them in an authoritarian manner, as has happened in the past. A barely masked spike against his predecessor, Carlos Ghosn, whose long stint at the head of the group between 2005 and 2019, and especially the Tokyo epilogue of his indictment in November 2018, traumatized the troops, and opened a long period of instability in the group.
This did not prevent the former automobile tycoon, now a refugee in Lebanon after his incredible escape from Japan last December, from claiming considerable sums from his former employer. If he has abandoned the idea of claiming 250,000 euros in compensation for retirement, the case concerning a retirement cap of 774,774 euros gross annually continues its course.
The ex-boss of the Alliance also claims 15 million euros from the two Japanese manufacturers, Nissan and Mitsubishi. Except that he is at the same time indicted by the Japanese justice system for having spent 11 million coming from Nissan funds for personal purposes (private jets, reception costs…), via a subsidiary of Renault Nissan in Amsterdam.
In France, a preliminary investigation was also opened on March 11, 2019 by the Nanterre public prosecutor's office (Hauts-de-Seine) concerning the financing of the birthday of his wife, Carole, as well as their marriage at the Palace of Versailles in October 2016 It will therefore be up to the judges to decide.
Objective: 2 billion euros in savings
The first project, and not the least: a savings plan of 2 billion euros over three years. Presented at the end of May by Jean-Dominique Senard and Clotilde Delbos, the former financial director who currently provides interim management since the ouster of Thierry Bolloré last October, it is Luca de Meo who will be responsible for putting it in music upon his arrival. The key: the loss of 15,000 jobs worldwide, including 4,600 in France, more than 8% of its workforce. But also the closure of certain sites. Starting with that of Choisy-le-Roi (Val-de-Marne), specializing in the renovation and reconditioning of mechanical parts, which has become too small, and whose activity would be transferred from 2023 to Flins (Yvelines). The same Flins who would see his historic automobile production activities definitively stopped.
The Dieppe factory also, which today produces the famous new generation A110 Alpines, raises many questions. As well as the future of the Foundry of Brittany, in Caudan (Morbihan), which loses 20 million euros per year. Among the twelve industrial sites of Renault in France, some are already going up in temperature like that of Maubeuge (North), specialized in small utilities, which has just known five days of strike against the project of transfer of a part of the production of the Kangoo on the Douai site, 70 km away.
A catalog of vehicles to review
It is therefore up to Luca de Meo to clear the ground. He was poached for that. "At gold prices, as usual, when we have just been forced into a big shortage for the next few years to come," we squeak internally. The Governance and Compensation Committee has indeed set its salary at 1.3 million fixed salaries per year, payable in twelve monthly installments. With, in addition, an annual variable portion equivalent to a maximum of 150% of this same fixed amount. As well as long-term variable compensation, through the allocation of 75,000 "performance shares" acquired after three years, based on a list of "success criteria". Enough to guarantee him, in the most optimistic hypotheses, up to 6 million euros per year. Less than the 7.5 million received at the time by Carlos Ghosn. And less also than what Luca de Meo earned at Volkswagen, the latter having agreed to lower his salary to join the French group.
Another project that the manager will have to tackle: a product plan that has become far too weak, a consequence of the race for volumes started by the old management. The objective displayed at the time was indeed to raise the Renault-Nissan-Mitsubishi Alliance to the rank of world number one, ahead of Toyota and Volkswagen. A race to the detriment of models, the renewal of which is long overdue. With prices (catalogs more discounted) flush with the daisies to sell stocks. The fifth generation of the Clio, the best-selling model in France, is displayed for € 1,200 below its direct competitor: the Peugeot 208.
The final average transaction price of a Renault would therefore be 6.5% lower than that of a Citroën, with the same version and engine. Not easy under these conditions to restore solid margins. However, this is exactly what Luca de Meo was able to put in place during his four years at Seat: to make people forget their low-end image by imposing higher selling prices. What specialists call in jargon: "pricing power".
The roles will nevertheless be clearly defined for the tandem, even the top three, if we include the highly respected Gilles Le Borgne, freshly poached from PSA to take the lead in research and development. To the latter all engineering activities therefore. To President Senard the industrial fiber, transversality and relations with the Alliance, and in particular Nissan. And to the CEO of Meo, operations, marketing and sales. On this side, the Italian wants to focus on the electric car, which he has been defending for several years. That's good: the Renault Zoé is the most sold 100% electric car in France. And Jean-Dominique Senard has placed this technology at the heart of his strategic plan. So, providential Luca de Meo?