By on March 30, 2011

Caution: This Nikkei story has been debunked by Nissan.

Often considered, more than often denied, now it’s on the table again: Nissan and Renault, having lived in an open relationship with a joint CEO since 1999, could move under the umbrella of a common holding company. Joint CEO Carlos Ghosn told that to The Nikkei [sub] late Wednesday night in Yokohama. The managements of Nissan and Renault seem convinced that this is the way to go. However, there is a lot of work to be done before the wedding will become official.

The plan is that Nissan and Renault create a holding company which then owns shares of Nissan and Renault. Russia’s AvtoVaz, 25 percent owned by Renault, along with Romanian Dacia and South Korean Renault Samsung Motors, currently subsidiaries Renault, would become parts of the group. The holding would be responsible for setting development, production and sales strategies. The group companies would execute the strategies.

The move would also thoroughly shake up the world ranking of car companies. Had this group existed in 2010, it would have produced close to 7 million cars and would have come into spitting distance of Volkswagen. Both the Volkswagen Group and Nissan have shown impressive growth numbers lately, which would make this race even more interesting. #1 Toyota and #2 GM suddenly would find themselves in hot pursuit by two aggressive groups.

And speaking of groups: If Nissan and Renault would change the current concubinage into a formal marriage, that odd German/Japanese couple Volkswagen and Suzuki could be drawn into doing something similar. If that would happen, the Wolfsburg-Hamamatsu axis would break the 10 million units sound barrier before Toyota or GM have a chance to get there.

However, these are all what ifs at the current point in time. Ghosn told the Nikkei that if the plan is a go, it would take two or three years to implement.  Ghosn will have to sell the plan to the shareholders of the group companies, one of them being the French government which owns 15 percent in Renault. The presence of AvtoVaz would provide added suspense.

The matter is giving the Nikkei sleepless nights. At 5 in the Tokyo morning, the Japanese wire service files another article, in which the move is feted as a big breakthrough for the dominance of the all-important emerging markets. However, the Volkswagen Group is likewise well positioned in all the BRIC countries, especially when Suzuki’s considerable market heft in the I of the BRIC is brought into play.

This will be a thrill to watch and to report on.

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16 Comments on “Watch Out, Toyota And GM: Nissan And Renault To Tie The Knot. (Update: They Won’t)...”

  • avatar

    This will be a thrill to watch and to report on.
    You said it, B. We get a few slow news days here and there, but this industry isn’t about to become boring anytime soon.

  • avatar

    For this to work unfettered, the company will have to buy back whatever shares are owned by the French government.
    One thing the French government will want to know is whether the combined company shall be based in France or Japan.

  • avatar

    Once it is done, the cancer of Renault technology, parts sourcing and general managment approaches will creep into Nissan even more, destroying whatever is left of the original technologically advanced and robust products. RWD platforms (Cedric/Skyline/Infiniti) are safe for a while, but I wonder what happens to them in case of full merger.

    • 0 avatar

      Mechanical RWD is a dying technology. Hope that electric cars are the future if you want RWD.

    • 0 avatar
      John Horner

      Renault saved Nissan from extinction, so that vaunted Nissan technology edge never amounted to much.
      If you read some of the history of the early Japanese automotive industry you will learn that Nissan followed a licensing/acquiring technology emphasis since its very beginning whilst Toyota was more intent on developing its own technology. The two companies have very different roots.

    • 0 avatar

      I do not care much if it is a RWD, AWD or whatever WD platform. I only mentioned it as an example of technology that is truly Japanese and without – let’s be polite – quirky influence of the French.
      @ John Horner.
      Your history lesson is of little relevance – especially if we start digging the roots of some well-known brands in Europe, for example. Nissan (Datsun, to be correct) benefited tremendously from merging with Prince in 1966 and has been extremely advanced in its engineering ever since. Its failures were purely poor marketing and management decisions.
      Renault, on the other hand, has very little cache as an engineering company. But it has a long record of making mechanically bizarre, unreliable, rust-prone, odd-looking contraptions.
      Here is a good example:

    • 0 avatar

      “Renault saved Nissan from extinction, so that vaunted Nissan technology edge never amounted to much.”
      How about L.E.A.F. or Leaf as in “Leading, Environmentally friendly, Affordable, Family” vehicle?
      I thought it’s all Nissan’s technology. And clearly Renault like it so much it is betting huge on it, too.

  • avatar

    VW should defo acquire Suzuki. Maybe then they can stop offering the Electric Gremlin trim on their models.

  • avatar

    This obsession with being the No.1 carmaker by volume is misguided. Advantages in scale and supplier price bargaining aside, extremely large organizations are notoriously difficult to administer effectively.  I would much rather be the No.1 carmaker by profit margins while keeping company size manageable.

    • 0 avatar

      Developing a car gets increasingly expensive. Add to that new technologies with unsure payback way down the road. At the same time, developing (and developed) markets demand low cost cars. You need to spread that over as many units as possible – in a smart way.

  • avatar
    Greg Locock

    “that odd German/Japanese couple” hmm, a self referential Bertel joke I think.

  • avatar

    Nissan-Renault have issued a pretty strong denial saying the reporter misunderstood Ghosn.

  • avatar

    Germany and Japan got together once before, if I remember my history.
    @Acubra- you have quite the acid tongue for someone named after a vinyl nosepiece for a tarted-up Honda.

  • avatar

    Bertel: What’s the latest relationship status of that odd German couple, eh, I mean VW/Suzuki?
    I heard there’s some friction. Any idea how long this sort of living-together-trial will last (either by marriage or separation)?

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