Shares in Renault (EPA:RENA) plunged as much as 17% on Wednesday after the French carmaker lowered its 2025 guidance due to weaker-than-expected sales volumes in June and a challenging European market.

The company said late on Tuesday it now aims to achieve a full-year operating margin of 6.5%, below a previous target of at least 7%.

It also warned on its free cash flow, which in the first half came to just 47 million euros ($54.49 million), hit by a negative working capital requirement of around 900 million euros due to delayed billings and a decline in the European passenger car and van market.

Shares were down 15.5% at 0753 GMT to 34.80 euros, on track for their worst day since March 2020, after earlier falling as much as 17%.

Renault said it would step up cost-cutting measures to improve margins in the second half but some analysts said longer-term market pressure could continue.

“We foresee longer-term market pressure playing out beyond June. Most of the European carmakers released a new lineup of affordable electric vehicles, increasing competition,” said analysts at Morningstar.

They said this raised concerns about leadership uncertainty in a volatile market.

Renault named finance chief Duncan Minto as an interim CEO on Tuesday and said the process for naming a permanent CEO was “well underway” but gave no update on timing.