Luca de Meo, the head of Renault, believes that the electric car division Ampere, which will be registered in the first half of 2024, could be valued at around 10 billion euros. He says the valuations of some auto startups, such as VinFast, which recently went public and reached a valuation of more than $80 billion, are completely unrealistic.

In 2022, Renault split, resulting in the electric car division Ampere. Luca De Meo said there was a need for a specialized electric division because producing this type of car is “a completely different sport” than producing conventional cars.

• How a Vietnamese car company became more expensive than Ford, Volkswagen or General Motors

In an interview with the Financial Times at the IAA exhibition in Munich, Luca De Meo said that the business could be valued at “eight, nine, ten billion euros” after the listing.

The head of Renault has warned that Europe’s auto industry is being held back by overly cautious investors in the region as traditional carmakers struggle to compete with what De Meo described as ridiculous valuations for recent electric car startups.

He gave the example of VinFast. “Look at the valuation of European companies,” said Luca De Meo, referring to BMW’s market capitalization of €62 billion, “do you think VinFast could be more valuable than BMW?” Let’s be serious,” added Luca De Meo.

VinFast is a Vietnamese company that was listed on the US stock exchange in mid-August and was briefly valued at $85 billion. Now valued at $68 billion, the company has only produced four car models and delivered just 19,000 vehicles in its short history, but it has high hopes for the US market.

Sources: Agerpres, Financial Times, Reuters