Wild-Ass Rumor Of The Day: Renault-Nissan Considering A Stake In GM?
Flirtation between Nissan and GM has a rich history, dating back to 2006, when the two firms nearly merged, in a move that would have left Nissan-Renault’s Carlos Ghosn in charge of French-Japanese-American juggernaut. GM fought off Ghosn’s advances (and a stockholder rebellion) to stay independent, but with a post-bankruptcy IPO now looming, Ghosn has once again appeared on GM’s horizon. In a bit of in-depth speculation at Dow Jones Investment Banker [via the WSJ [sub]] Jamie Miyazaki and Alessandro Pasetti break down the pros and cons of a Renault-Nissan hookup with GM. Their conclusions: although, Renault is currently playing footsie with Daimler:
Over the long haul, looking west to General Motors in the U.S. could prove more fruitful for Renault than strengthening partnerships in Europe’s saturated market. Taking an equity stake in a reborn, and eventually relisted, GM would give the Renault-Nissan alliance exposure to the U.S. auto giant’s diverse geographic presence… GM [has] shifted about 37% of its total 2009 sales in Asia, South America and Eastern Europe, according to J.D. Power & Associates data. Throw in GM’s plans to ramp up its Indian operations and its large presence in the Brazilian market, where Renault is investing to roughly double its market share to 10%, and the Detroit giant’s allure is obvious.
Paging Captain Kirk!
Miyazaki and Pasetti figure the Renault-Nissan flirtation with Daimler is a limited deal that
wouldn’t be transformational — rather, it’s a game several European automakers have been playing since 2007 with the upshot that there are not too many eligible partners left.
That certainly adds up: the Renault-Nissan/Daimler deal is about one thing: a subcompact FWD platform to replace Renault’s flopping Twingo and give Mercedes the downmarket reach to meet Europe’s aggressive emissions standards. A long-term hookup would usher in a DCX 2.0 debacle of nightmarish proportions. The two firms are simply too strong in the same markets.
But GM and Renault-Nissan? Let’s put it this way: how often do bailed-out automakers hold IPOs? Besides, their market shares by region show that synergies are possible. On the other hand, this could just be a rumor designed to make the speculators think Ghosn will snap up a large chunk of GM’s IPO, thus inflating the value of GM’s debt and IPO. In fact, until we hear something a little more concrete, we have to assume that IPO speculation is the real motivation behind this “what if” scenario. If we’re wrong, we’ll literally have years to watch this deal unfold, as it would be one of the biggest, most complex mergers in car biz history.
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