Renault and Nissan have pledged to continue their alliance as its architect, Carlos Ghosn, resigned from the French carmaker.

Mr Ghosn’s resignation came as he remained incarcerated in Japan where he is accused of financial misconduct at Nissan.

Renault said Michelin’s Jean-Dominique Senard had been appointed chairman, and Thierry Bolloré chief executive. Mr Ghosn was sacked by Nissan shortly after his arrest on 19 November.

Renault’s management shake-up was welcomed by Nissan’s chief executive Hiroto Saikawa. “In the big picture, this is a big milestone that we are reaching. We are starting a new chapter. So I welcome this new leadership of Renault,” Mr Saikawa said.

Global giant

The architect of the Renault-Nissan alliance, Mr Ghosn had not been sacked by Renault. Instead, the French car giant had handed day-to-day operations to Mr Bolloré, who now takes the role permanently. Mr Ghosn faces three charges in Japan of financial misconduct, including understating his income and aggravated breach of trust. He denies any wrongdoing and could remain in custody for months after his application for bail earlier this week was denied.

Questions had been asked about future of the alliance – which Mitsubishi joined three years ago – which Mr Ghosn oversaw. It sold 10.6 million vehicles in 2017 and together employs 470,000 around the globe.

On Thursday, as Renault announced its boardroom change it did not use Mr Ghosn’s name but said: “The board praised the alliance’s track record, which has enabled it to become the world’s leading automobile manufacturer”. Until his arrest, Mr Ghosn had achieved star status in Japan.

Renault
Renault

Born in Porto Velho, Brazil, to Lebanese parents, according to one poll he was the man most Japanese women wanted to marry and in another he came seventh in a poll of who should run the country.

He oversaw Nissan’s recovery after Renault took a stake in the then-troubled car maker in 1999, the start of the alliance.

Renault’s new chairman, Mr Senard, will be responsible for managing Renault’s alliance with Japanese carmaker Nissan, while Mr Bolloré will co-ordinate the carmaker’s activities.

Mr Senard also backed the alliance. “It’s important that this alliance remain extremely strong,”. It is our compulsory duty to go forward together. They are going to have to come up with new ways to glue it together,” Prof Bailey said.

Renault has said previously that it has not found any evidence of wrongdoing yet, and an investigation into executive pay has shown no signs of fraud so far.

Mr Saikawa said “communication between the boards of the two companies has been a bit difficult” since Mr Ghosn’s arrest, and that he was looking forward to “better communication”.

Nissan said it had now begun preparations to hold an extraordinary general meeting in April to discuss new board members.

The agenda will be to cover the departure of Carlos Ghosn and Greg Kelly, an aide to Mr Ghosn who was arrested in November and bailed on Christmas Day. The shareholder meeting will also cover the appointment of a new director to be nominated by Renault.

The company’s board is widely expected to name interim chief executive Thierry Bollore as CEO, and Michelin head Jean-Dominique Senard as its chairman — both roles were previously held by Ghosn.

A board meeting is scheduled for 10:00 am (0900 GMT) at the company’s headquarters outside Paris.

Ghosn, the most powerful man in car-making until his sensational arrest in Japan last November on financial misconduct charges, had already been sacked as chairman of Japanese auto groups Nissan and Mitsubishi. But the 64-year-old had held on to the top job at Renault, which has been run on an interim basis by one of his deputies while he languishes in a Japanese jail.

As head of Renault since 2005, Ghosn was the keystone of its alliance with Nissan and Mitsubishi, forging an industry powerhouse which together sold more cars than any of its rivals last year.

Uncertain future

The future of the Renault-Nissan-Mitsubishi alliance has been thrown into doubt with the arrest of Ghosn, who is widely credited with reviving Nissan and fusing together two vastly different corporate cultures.

Bollore, a 55-year-old at Renault since 2012, has held various positions in the car industry in Asia and is seen as someone who can maintain stability as the alliance enters a new era. Media reports have suggested Nissan officials are bristling at suggestions of an even closer integration of their operations, though Le Maire denied such plans over the weekend.

Renault owns 43 percent of Nissan, which in turn has just a 15 percent stake in its French partner and no voting rights.

But Nissan’s market value is nearly double that of Renault’s, prompting some to expect the Japanese side will seek to rebalance the terms of their relationship. It remains unclear, for example, who will replace Ghosn as head of the alliance. That role traditionally has been reserved for Renault’s CEO, while Nissan chooses its vice president.

Senard, for his part, is understood to have the backing of the French state, which owns just over 15 percent of Renault and holds 22 percent of the voting rights. With a ready smile and elegant attire, Senard has successfully negotiated sensitive labour agreements with trade union leaders in Michelin’s French factories to preserve jobs in the face of cheaper imported Asian products.

Alliance ‘not in danger’

Ghosn is expected to stay behind bars for several months after seeing a second bail request denied on Tuesday. His own lawyer has warned that a trial could take at least six months to organise given the complexity of the case. He faces three separate charges: two of under-declaring his income by tens of millions of dollars over eight years and another of seeking to shift personal investment losses onto Nissan.

The 64-year-old executive has been seen in public only once since his arrest on November 19 stunned the business world — in a dramatic courtroom appearance where he passionately denied the charges and declared his “genuine love” for Nissan.

Current Nissan CEO Hiroto Saikawa, who oversaw his former mentor’s downfall, has stressed that the alliance is “absolutely not in danger”.

But the Japanese firm now outperforms its French “superior” — selling 5.81 million cars in 2017 compared with 3.76 million for Renault.

This has led to grumbling within Nissan that its weight is not properly represented and even to conspiracy theories that Ghosn’s downfall was orchestrated by frustrated Nissan executives — which Saikawa dismisses as “absurd”.

LEAVE A REPLY

Please enter your comment!
Please enter your name here