The alliance between the Japanese car maker Nissan and the French automobile company Renault should continue to exist even after the final and ultimate exit of the embezzled former chairman and chief executive of both the companies Carlos Ghosn, said Japan’s trade minister.
Till the time that he was arrested in November in Japan on charges of financial misconduct, Ghosn was the head of both the companies – Nissan and Renault. The arrest of Ghosn was a very unexpected incident for the global auto industry because of his stature in the industry and had also cast a shadow over the alliance between Nissan and Renault – which also had Mitsubishi in its fold, which together makes the largest partnership in the auto industry of the world. Ghosn resigned from Renault as its head and CEO on Thursday.
There is seemingly an imbalance in the alliance as alleged by Nissan because even though the Japanese company contributes the greater share of profits, the French company Renault is the dominant partner in the alliance because it owns a greater share of Nissan according to the unusual cross-shareholding structure of the alliance.
For Japan, prospect that the alliance continues to prosper and do well is politically important because Mitsubishi is also a partner in the alliance because of the significant amount of shares that Nissan owns in the other Japanese company. On the other hand, the French government is the largest shareholders of Renault with a 15 per cent stake.
A call for keeping the stability of the alliance was given on Friday by Hiroshige Seko, the Japanese trade minister. While he said that he had held a meeting with France’s finance minister, Bruno Le Maire, he also confirmed that there was not discussion about the alliance of the auto companies.
“We think a stable Nissan-Renault alliance must continue. We hope the executives of the two companies can engage in fruitful discussions,” Seko told reporters at the World Economic Forum in Davos – an event that had been previously attended by Ghosn on several occasions.
Ghosn was arrested in Japan on November 19 g\following a complaint by Nissan that he had under reported the remuneration that the company had given him over a substantial period of time. His arrest had however threatened to disrupt the alliance because the charismatic French-Lebanese-Brazilian executive spearheaded not only the formation of the alliance but also its activities and policies over the years. Ghosn was removed from both Nissan and Mitsubishi as their head soon after his arrest. Renault however initially had refused to remove him until his eventual resignation. Ghosn is still behind bars in Japan and there is little imminent chance of his release.
On Thursday, Renault announced that the role of Ghosn would be divided into two parts and appointed the outgoing Michelin boss, Jean-Dominique Senard, as chairman of the company and Thierry Bolloré as the chief executive of the company.
Senard has been tasked by the Renault board to hold negotiations with Nissan and Mitsubishi about the future of the alliance. Nissan’s chief executive, Hiroto Saikawa, has suggested the alliance should be rebalanced.
(Adapted from TheGuardian.com)