Renault on Wednesday reported a 9% increase in annual sales in 2023, returning to growth after four straight years of decline, and the French automaker said it will continue to deliver strong performance in 2024.

Renault shares were down 1.9% in morning trading, along with other European automakers whose shares suffered after Tesla cut prices for its Model Y electric cars in Germany.

With Renault facing a semiconductor chip shortage in 2022, sales fell nearly 6% after setting a sales record of 3.88 million vehicles – cars and vans – in 2018.

Renault’s sales slump was exacerbated by its withdrawal from the Russian market.

To boost sales, Renault cut its model lineup and, under the leadership of CEO Luca de Meo, refocused on its most profitable markets and models.

The return to growth shows that de Meo’s plans have started to bear fruit. Although the group’s performance was below the 12% growth posted by Volkswagen, Renault said its sales in Europe rose 18.6%, above industry growth of 13.9% for the year.

Europe accounted for 63% of sales in 2023, but the automaker plans to grow beyond Europe by launching eight new global models by 2027.

In a client note, ODDO BHF analyst Michael Fountoukidis called Renault’s sales performance in 2023 “relatively robust,” noting that the automaker could outperform the market in 2024 “thanks to the numerous model launches planned for that year.”

Renault’s flagship brand, which accounts for more than two-thirds of the group’s sales, posted sales growth of 9.4% in 2023, while sales of budget brand Dacia rose 14.7%.

The group’s order book in Europe represents 2-1/2 months of projected sales at the end of December 2023, Renault added.

Electrified models will account for 40% of Renault brand sales in 2023, up from 38% in 2022. All-electric models accounted for 11% of sales.