Renault Shares Tumble as CEO Luca de Meo Depart

Renault SA shares (ETR: RNO) experienced a sharp decline this morning, down 7.55% at €39.77 following the announcement that CEO Luca de Meo would be stepping down. Now it is said that he may be set to take the helm at French luxury conglomerate Kering.

De Meo's departure, effective July 15, 2025, has injected uncertainty into the market, overshadowing the progress made during his five-year tenure. Renault's stock price has been under pressure for the last month of trading, with a decline of 18.44% on the period.

The news sent ripples through the financial markets, contrasting sharply with the positive reaction to the announcement from Kering investors, who saw their shares (KER) rise by roughly 9.5% in early trading.

De Meo, credited with revitalizing Renault through strategic product enhancements and improved cost efficiency, could now be tasked with reversing Kering's recent struggles, including a 70% decline in share value over the past three years, largely attributed to underperformance at its flagship brand, Gucci. His appointment coincides with François-Henri Pinault's decision to separate the chairman and CEO roles at Kering.

Renault's Board of Directors, led by Chairman Jean-Dominique Senard, has initiated the process of appointing a new CEO, drawing upon a pre-defined succession plan. While the board expressed gratitude for De Meo's contributions, the transition period carries inherent risks. The market will be closely watching for signs that the new leadership can maintain the company's strategic momentum and navigate the challenges facing the automotive industry, including the transition to electric vehicles and intensifying competition from Chinese manufacturers.

Adding to the complexity, Nissan Motor CEO Ivan Espinosa recently announced plans to reduce Nissan's stake in Renault from 15% to 10%, a move aligned with a previous agreement to rebalance their long-standing partnership. While Nissan has affirmed that its cooperative agreement with Renault remains unchanged, the reduced stake could impact the dynamics of the alliance and potentially influence Renault's future strategic decisions.

De Meo's departure marks the second significant executive exit in the European automotive industry within six months, following Carlos Tavares' resignation from Stellantis. These leadership changes highlight the turbulent landscape and evolving priorities within the sector. Renault's ability to swiftly and effectively appoint a successor and maintain its strategic focus will be crucial in mitigating the negative impact of this leadership transition.