21 November, 2018

Renault announces ‘temporary CEO’ as Ghosn case highlights tensions

Renault has announced its contingency plans as CEO Carlos Ghosn faces another ten days of detention over his alleged misconduct in his role of Chairman at Nissan.

Thierry Bolloré has been announced as deputy chief executive officer on a temporary basis, with the company stating that Ghosn remains in his role, even though he is ‘currently incapacitated’. Bolloré will, therefore, lead the management team of the Group, having the same powers as Ghosn.

In its statement, Renault also said: ‘The Board decided to request Nissan, on the basis of the principles of transparency, trust and mutual respect set forth in the Alliance Charter, to provide all information in their possession arising from the internal investigations related to Mr Ghosn.

‘The Board endorsed the support expressed by the Nissan management to the Renault Nissan Mitsubishi Alliance, which remains the priority of the Group.’

Potential merger

Further information has come to light regarding the reasons around Nissan’s investigation into Ghosn, who the carmaker believes underreported his pay details and misused company assets in his role as Chairman.

There is a belief that Nissan is seeking ways to weaken the influence that Renault has over its business, with some reports suggesting that Ghosn was looking to merge the two companies. While Nissan has been an active force in the Renault-Nissan-Mitsubishi Alliance, there are hopes that the current situation will lead to more equality across the business.

Renault owns 43.4% of Nissan, and any new structure of the Alliance board could potentially see this stake reduced, a move the Japanese carmaker would welcome as it looks to take more control over its future. However, speculation as to whether the Alliance may break has been called ‘wide of the mark.’

Tensions arise

However, while Nissan investigates Ghosn and aims to remove him from his position later this week, Renault’s announcement that Bolloré is acting as CEO in the interim while its current CEO is ‘temporarily incapacitated’ suggests the French carmaker is going to wait until all the facts have been shared between the two manufacturers before it decides its future direction.

This could add to tension in the Alliance, with Nissan publicly showing no faith in the Brazilian, while the French carmaker sits on the fence. The French Government, which owns 15% of Renault, is also unhappy with keeping Ghosn in his role, although it has stopped short of acting on these feelings.