Proposed FCA-Renault Merger Puts Nissan in a Awkward Spot
Nissan has long felt like an unequal partner in its alliance with Renault, and has continually resisted pressure to strengthen its ties with the French automaker. With a potential merger between Fiat Chrysler and Renault now in the discussion phase, the Japanese automaker, having just suffered a year of sales and profit losses, finds itself staring down the barrel of further inequality.
Should the Italian-American and French companies merge, Nissan’s influence would shrink by half. Still, the automaker claims it’s open to discussion.
Currently, Nissan holds a 15-percent stake in Renault, with no voting rights, versus Renault’s 43.4-percent stake in its own business, plus voting rights. Under a merger scenario, the new entity would maintain its stake in Nissan, though Nissan’s stake in Renault would shrink to 7.5 percent.
Similarly, the French government would see its 15-percent stake in Renault drop to 7.5 percent.
The concern is that Nissan’s influence in the relationship would erode further, weakening its bargaining power and kiboshing future attempts to assert itself. There’s also the issue of technology and platform sharing, something the Renault-Nissan-Mitsubishi Alliance was built on. As Hans Greimel posits in Automotive News, what becomes of Nissan’s truck presence in North America under such a scenario?
FCA CEO Mike Manley is eager for a Ram-badged midsize truck to compete against Ford, General Motors, and Toyota. While the architecture underpinning Nissan’s replacement for the ancient Frontier, a new platform spearheaded by Mitsubishi, could be of use to FCA, Nissan’s full-size Titan and larger Titan XD would find themselves in an awkward relationship with Ram’s far more popular 1500 and HD.
Meanwhile, the French government has demands.
As reported by Reuters Tuesday, French finance minister Bruno Le Mair told local media that, while the proposed merger holds opportunities for Renault and the European auto industry, his government’s support hinges on a number of guarantees. Not surprisingly, French jobs are top of mind.
“The first: industrial jobs and industrial sites. I told the Renault chairman very clearly that it was the first of the guarantees I wanted from him in the opening of these negotiations. A guarantee on the preservation of industrial jobs and sites in France,” Le Mair said.
The minister added that his country desired adequate French representation on the entity’s board, as well as a guarantee that the country be a leader in the development of electric vehicle batteries. He also wished to see the merger occur “within the framework of the alliance between Renault and Nissan.”
Nissan’s CEO, Hiroto Saikawa, told a Japanese news outlet on Tuesday that “strengthening the alliance and constructive discussions are forward looking, and we are open to constructive discussions.”
As news of the potential merger broke Monday, the Italian government also took interest, mulling a stake in the combined entity to offset its partial French ownership.
[Image: Memory Stockphoto/Shutterstock]
More by Steph Willems
Latest Car Reviews
Read moreLatest Product Reviews
Read moreRecent Comments
- Arthur Dailey The longest we have ever kept a car was 13 years for a Kia Rondo. Only ever had to perform routine 'wear and tear' maintenance. Brake jobs, tire replacements, fluids replacements (per mfg specs), battery replacement, etc. All in all it was an entirely positive ownership experience. The worst ownership experiences from oldest to newest were Ford, Chrysler and Hyundai.Neutral regarding GM, Honda, Nissan (two good, one not so good) and VW (3 good and 1 terrible). Experiences with other manufacturers were all too short to objectively comment on.
- MaintenanceCosts Two-speed transfer case and lockable differentials are essential for getting over the curb in Beverly Hills to park on the sidewalk.
- MaintenanceCosts I don't think any other OEM is dumb enough to market the system as "Full Self-Driving," and if it's presented as a competitor to SuperCruise or the like it's OK.
- Oberkanone Tesla license their skateboard platforms to other manufacturers. Great. Better yet, Tesla manufacture and sell the platforms and auto manufacturers manufacture the body and interiors. Fantastic.
- ToolGuy As of right now, Tesla is convinced that their old approach to FSD doesn't work, and that their new approach to FSD will work. I ain't saying I agree or disagree, just telling you where they are.
Comments
Join the conversation
Too bad, Nissan. Throwing Ghosn in jail is now going to bite you in the ass in a big way.
I'm kind of amazed that nearly 20 years after its salvation Nissan is right back on the brink of collapse. Someone on another comment thread about this whole thing called Nissan the Chrysler of Japan. Judging by these proceedings that sounds like wishful thinking