Ghosn Says Slow Your Roll on the Renault-Nissan Merger, Then Confirms the Possibility

Matt Posky
by Matt Posky
ghosn says slow your roll on the renault nissan merger then confirms the possibility

As Renault and Nissan discuss ways to strengthen their bond, Carlos Ghosn is asking everyone to slow their roll on the prospect of a merger. Despite continuously nudging the alliance in that direction, the CEO and chairman is often hesitant to discuss unification as anything more than a hypothetical. So this is par for the course.

“I don’t think you’re going to see it this year or next,” Ghosn said on Wednesday. “Lots of mergers collapse and destroy value — the strength of any company is the ability to motivate people, and how how are you going to do that if some of these people consider themselves second-class citizens.”

The second-class citizens he’s referencing are, presumably, Nissan employees seeking more influence within the Renault-Nissan-Mitsubishi Alliance. A large part of the group’s current strategy is to find ways to give the Japanese automaker more of a say in product development and operations.

As the more profitable automaker, Nissan feels it’s entitled to make decisions. But Renault currently has a 43.4 percent stake in Nissan, while Nissan only holds a 15 percent stake in Renault — effectively giving the French automaker corporate control.

Both Ghosn and Nissan’s CEO Hiroto Saikawa seem bent on creating a lasting relationship between their companies before their retirement, but they also seem keenly aware that the road ahead of them is fraught with peril — leaving both of them cautious when discussing a merger. However, Ghosn said he hoped to have see important decisions made that would strengthen the alliance by the end of this year.

“I don’t think there is a resistance,” Ghosn told Bloomberg in an interview. “Let’s try and find something that will reassure the stakeholders that this will continue, but at the same time maintain identity.”

He also issued a reminder that decisions take time to produce results within the industry, be it product or corporate developments. “You know our cycle, in terms of technology and product, is very long,” Ghosn said. “So what you are doing today is something that’s going to be visible three or four years down the road.”

He went on to stress that electric cars are regulator driven, which makes their future prospects a little easier to track. But automakers have to perpetually work with governments to help them understand the advanced technologies they’re requesting (but might not be particularly familiar with).

Getting back to the alliance, Ghosn noted that Nissan and Renault will experience a conversion, but stopped short of calling it full-blown merger. “We have already decided to have a common engineering, we have decided to have a common manufacturing, we have common purchasing,” he said. “This move toward more integration, toward doing more things in common, but still maintaining different brands [and] different identities you will continue to see.”

However, he’s worried about the sustainability of that model after the automakers’ current leadership retires. The top boss said a merger is one option for solving that problem, but not the only one. Ghosn explained that the ideal solution, for him, involves a drive for synergies to solidify the collaboration while allowing each brand to maintain its unique identity.

“At the end of the day, you need people who are proud of their brand going and fighting in all the markets,” he said. “But, at the same time, you don’t want duplication. You develop one technology, one platform, we buy together. Everything that the consumer doesn’t really care for should be done in common for the sake of efficiency and for the sake of .”

[Image: Nissan]

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  • Kyree Kyree on May 23, 2018

    Well, it's not the ill-fated DaimlerChrysler Merger of Equals, and the two automakers already have a great relationship, so I bet it'll work out fine. And maybe it'll result in US-bound Renaults. Probably not, but maybe.

  • Inside Looking Out Inside Looking Out on May 23, 2018

    May they take Chrysler also on the board? Apparently Sergio has no clue what to do with American brands, busy with useless vanity projects like AR and Levante.

  • Jim Bonham Full EVs are not for everyone, they cannot meet all needs. Hybrids do a much better job of providing the benefits of EVs without most of the drawbacks. I have a hybrid sedan with plenty of room, plus all the bells and whistles. It has 360 hp, AWD, does 0-60 in just over 5 sec.(the instant torque is a real benefit), and I get 29 mpg, average. NOT driven lightly. I bought it used for $25k.Sure, it's a little heavier because of the battery, motor, etc., but not nearly as much as a full EV. The battery is smaller/lighter/cheaper and both the alternator and starter motor are eliminated since the motor assumes those functions. It's cool to watch the charge guage show I'm getting energy back when coasting and/or braking. It's even cooler to drive around part of the time on battery only. It really comes in handy in traffic since the engine turns off and you don't waste fuel idling. With the adaptive cruise control you just let the car slowly inch along by itself.I only wish it were a Plug-in Hybrid (PHEV). Then, I'd have A LOT more EV-only range, along with even more of that instant torque. The battery would be bigger, but still a fraction of the size of a full EV. I could easily go weeks without using much, if any gas (depending upon my commute) IF I plug it in every night. But I don't have to. The gas engine will charge the battery whenever it's needed.It's just not as efficient a way to do it.Electric companies offer special rates for both EVs and PHEVs which lower your operating cost compared to gasoline. They'll even give you a rebate to offset the cost of installing a home charger. You can still get federal (up to $7,500, plus some state) tax credits for PHEVs.What's not to like? My next daily driver will be a PHEV of some kind. Probably a performance-oriented one like the new Dodge Hornet or one of the German Hybrid SUVs. All the benefits, sound, feel, etc., of a gas vehicle along with some electric assist to improve fuel economy, performance, and drivability. None of the inherent EV issues of cost, range anxiety, long charging times, poor charger availability, grid capacity issues, etc. I think most people will eventually catch on to this and go PHEV instead of going full EV. Synthetic, carbon-neutral eFuels, hydrogen engines, and other things will also prevent full EVs from being 100% of the fleet, regardless of what the politicians say. PHEVs can be as "clean" (overall) as full EVs with the right fuels. They're also cheaper, and far more practical, for most people. They can do it all, EVs can't.
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