The tug-of-war between Nissan Motor Co. and Renault over who will lead their alliance has entered a new phase after the leading French automaker announced its new management.
For the time being, Nissan intends to continue talks with Renault, but the dialogue could develop into a cut-and-thrust struggle that could lead to a review of their capital ties.
At a press conference held Thursday night, Nissan President and Chief Executive Officer Hiroto Saikawa welcomed Renault's appointment of Jean-Dominique Senard, chief executive officer of France's leading tire maker Michelin Group, to succeed Carlos Ghosn as Renault's chairman.
"Mr. Senard is a very respectable person. We can communicate with him with transparency," Saikawa said.
Saikawa also presented a plan to hold an extraordinary general meeting of shareholders in mid-April to nominate Senard as a new director at Nissan to succeed Ghosn, who was also its chairman.
"We hope Mr. Senard will join in the process [of Nissan's management reform] as soon as possible to work and struggle together with us," Saikawa said.
Senard joined Michelin in 2005 after working for France's leading oil company Total and other firms. In 2012, he became the CEO of the tire company, where he shut down unprofitable plants and bought out peers in the industry, establishing a reputation for being highly skilled in management.
Constructive dialogue
The Nissan-Renault relationship has continued to deteriorate since Ghosn's arrest on Nov. 19 last year.
On Nov. 22, Nissan swiftly discharged Ghosn as chairman and representative board member, but Renault kept Ghosn in his position while having Thierry Bollore act as CEO. Renault repeatedly demanded that Nissan hold an extraordinary general shareholders meeting as soon as possible, only to be rejected by Nissan. Tension rose between the two companies.
The sudden change of stance on the part of Saikawa, to hold an extraordinary general shareholders meeting and accept the appointment of a new director nominated by Renault, apparently came from his judgment that Renault's management change would give Nissan the opportunity to hold constructive talks with the French automaker.
In its latest move, Renault intends to diversify authority by separating the posts of chairman and CEO, both of which had been held by Ghosn.
At the press conference, Saikawa said: "Communication between the boards has been somewhat difficult. We hope [the change] will help improve the situation."
Some at Nissan have the view that Senard will assume the office of Nissan's chairman, succeeding Ghosn.
Rebuilding alliance
Nissan is expected to put off for the time being a revision of its somewhat lopsided capital ties -- Renault holds 43.4 percent of Nissan's shares, while Nissan holds 15 percent of Renault's -- and instead focus on rebuilding its alliance.
The three-way tie-up between Nissan, Renault and Mitsubishi Motors Corp. involves more to review than just capital ties.
Nissan and Renault use common core auto parts, such as car bodies and engines, for many of their flagship models. They have also integrated their development departments to make the most of their tie-up, including reducing costs.
"We already have a relationship which cannot be easily dissolved," a Nissan executive said.
On the other hand, it has been said that Ghosn's call to maximize the effects of the tie-up have been the cause of some problems.
According to a source close to the matter, employees were asked to consider ways to use common parts as much as possible with no regard for the differences between the two companies -- such as factory locations and production systems -- which resulted in meaningless trial calculations and other "fruitless work."
According to France's Le Monde newspaper, Senard is close to French President Emmanuel Macron. The dominant view is that the French government hopes for a business merger of Renault and Nissan. Some observers say that a fierce battle between the two over a review of their capital ties is inevitable.
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