Renault and Nissan relaunch automotive alliance for post-Ghosn

LONDON — Automakers Renault and Nissan on Monday formalized the restart of a relationship that had grown rocky, culminating in the dramatic downfall of top executive Carlos Ghosn, who led successful turnarounds at both companies before his arrest and daring escape.

Both companies’ boards have approved equalizing each automaker’s stake in the other to 15%, bringing a better balance to the Franco-Japanese alliance, which also includes Japan’s smaller automaker Mitsubishi. Motor Corp. Unequal participation had sometimes been seen as a source of conflict.

Until now, the French Renault Group owned 43.4% of Nissan Motor Co., while the Japanese manufacturer owned 15% of Renault.

“We’ve been waiting for this moment for a long time,” Renault board chairman Jean Dominique Senard told a press conference in London, calling it a “new era.”

Nissan intends to invest up to 15% in Ampere, Renault’s electric vehicle and software unit in Europe in which Mitsubishi will also consider investing. The automakers said they would collaborate in markets around the world, including Latin America, Europe and India.

These measures come at a time when the fiercely competitive automotive industry is undergoing a major shift towards electric vehicles and other environmentally friendly models.

The long-speculated changes to the automakers alliance were announced a week ago. Shares equivalent to a 28.4% stake will be transferred to a French trust, according to the companies.

Renault, whose main shareholder is the French government, and Nissan have agreed on an orderly sale of this stake, although there is no deadline.

Nissan chief executive Makoto Uchida has pledged to take the alliance to the “next level of transformation” to adapt to a new era.

“It’s not a choice but a need,” he said.

In theory, partnerships are a good way for automakers to cut costs by sharing parts, production and technology, especially when the industry is going through such dramatic changes with electric vehicles.

It also means that once formed, ending an alliance can be difficult because the companies’ development, manufacturing and products are so intertwined.

Yet partnerships can stumble due to the different corporate cultures of automakers, especially when it comes to a meeting between West and East.

The Renault-Nissan alliance, which began in 1999, was plunged into scandal when Ghosn, the executive sent by Renault to lead the recovery of Nissan then on the verge of bankruptcy, was arrested in Japan in 2018 for financial misconduct .

Ghosn, who says he is innocent, jumped bail in a daring escape by hiding in a feisty box aboard a private jet and now lives in Lebanon, which does not have an extradition treaty with the Japan. Renault and Nissan have distanced themselves from the Ghosn scandal.

In an interview with The Associated Press, Senard pointed out that Renault is definitely in the post-Ghosn era.

” It’s from the past. I mean, nobody at Renault today talks about this topic,” he said, without mentioning Ghosn’s name. “They’re all focused, honestly, on the future, on what we’re doing. “

With its Ampere project, Renault is trying to bolster its range of electric cars like other automakers, adding to an increasingly competitive field long dominated by Tesla. Senard said he was confident about the chances of the French manufacturer.

“You look at the new cars coming out of the Renault factories today. They’re just gorgeous,” he said. “I mean, they have nothing to be jealous of when they look at Tesla and those other guys.”

The Renault chairman acknowledged that Chinese electric car brands exporting to Europe have a “strong cost advantage”, but that gives the French automaker more incentive to be competitive.

“It’s a bet, but as you understand, we decided to win this bet,” he said.

Executives at the press conference, including Renault CEO Luca de Meo, stressed that collaborations, cost reductions, model offerings and sales will increase, noting that the relationship between the companies will turn to the future and will become “normal”.

Senard seemed to recognize the bumps along the way when he noted hope that past misunderstandings would be resolved.

“Those frustrations are behind us,” he told reporters.

Renault exited the Russian market last year after the invasion of Ukraine, selling its majority stake in Avtovaz, a Russian automaker best known for its Lada brand, and its Moscow plant for a token single rouble.

Senard told the AP the door is still open for the company to return.

“If one day we thought it made sense to come back to Russia in some form, that means a lot of things would have changed. If that happens, why not?” he said.

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Kageyama reported from Tokyo.