Report: Ghosn Actually Does Appear to Have Been Set Up
Carlos Ghosn’s claim that he was the target of an industrial coup is looking a lot more valid this week after emails surfaced showing a high degree of internal organization regarding his ousting and subsequent criminal charges. The former head of the Renault-Nissan-Mitsubishi Alliance was infamous for wanting further integration within the pact. In fact, his aim was to make sure the tie-up became “irreversible.”
That idea never quite landed for Nissan leadership and Japanese shareholders, with many already holding the view that the alliance had already given French interests too much authority.
Emails dating back nearly one year before Ghosn’s November 2018 arrest clearly indicate top-level management at Nissan had a strong aversion to deepening ties with Renault. While understandable to a large degree, it’s counter to the claim that his removal was strictly about under-reported income and other financial malfeasance that were of particular interest to Tokyo prosecutors. At the very least, some actors at Nissan wanted to make sure the alliance patriarch suffered a massive loss of face while confronting allegations.
Nissan was interested in removing Ghosn from power for some time. According to Bloomberg, digital documents and interviews with people in the know seems to indicate there was a plan to have Ghosn removed long before any action was taken. While that doesn’t necessarily absolve him from any criminal wrongdoing, it does lend weight to claims that some of the items he was being accused of were sanctioned by Nissan. It also makes his insistence that the whole thing was a setup seem downright probable.
A chain of email correspondence dating back to February 2018, corroborated by people who asked not to be identified discussing sensitive information, paints a picture of a methodical campaign to remove a powerful executive. The information comes to light as another former Nissan executive and the company itself face a looming trial in Tokyo, and as Japan seeks the extradition of Ghosn, 66, who fled to Lebanon in a daring escape last year.
Alarmed by Ghosn’s pledge in early 2018 to make the alliance between the companies irreversible, senior managers at the Japanese automaker discussed their concern at how the chairman of both Nissan and Renault was taking steps toward further convergence, according to people familiar with discussions at the time.
Hari Nada, who ran Nissan’s chief executive’s office and later struck a cooperation agreement with prosecutors to testify against Ghosn, seems to be ground zero. He emailed Hitoshi Kawaguchi, Nissan’s senior manager regarding government relations, in 2018 to suggest the company stop his initiatives “before it’s too late.”
Nada also told former CEO Hiroto Saikawa that Ghosn was becoming increasingly annoyed with Nissan’s waning performance and to exercise caution. Saikawa, who had close ties with Ghosn and was hand picked by him to run Nissan, was warned that the prospective merger placed the two at odds with each other at a difficult time. “He can create a major disruption and you may become a victim of it,” Nada wrote.
Nissan’s official take has been that it moved to take Ghosn down only after a whistleblower’s report (Nada’s) pegged him and his lawyer, Greg Kelly (who remains in Japanese custody), for financial crimes. It was also known that the alliance head was coming down pretty hard on Nissan leadership for the automaker’s lackluster performance, and that firings were in the planning stage. Ghosn was clearly poised to clean house, only to be arrested before getting the opportunity.
Days before Ghosn’s arrest, Nada sought to broaden the allegations against Ghosn, telling Saikawa that Nissan should push for more serious breach-of-trust charges, according to correspondence at the time and people familiar with the discussions. There was concern that the initial allegations of underreporting compensation would be harder to explain to the public, the people said.
The effort should be “supported by media campaign for insurance of destroying CG reputation hard enough,” Nada wrote, using Ghosn’s initials, as he had done several times in internal communications stretching back years.
When asked to comment for this story, Saikawa referred to his prior public statements rejecting the existence of a plot to oust Ghosn. “There was no effort to remove Renault’s influence” by removing Ghosn, Saikawa told reporters in January after the former chairman accused Nissan executives of conspiring against him during a news conference in Beirut. “There’s a huge difference between that and his crimes,” Saikawa said then.
Saikawa abandoned his post last year after he was likewise found to have been issued better pay than he was supposedly entitled to. Other executives, including Nada, were found to have similar financial oddities.
While internal investigations at the automaker found no “inappropriate involvement” regarding Nada’s behavior, the company did limit his duties last fall and did its utmost to usher him out of the spotlight. Nissan managed to argue for more of what it wanted in the confusion following Ghosn’s arrest, as well. It has not, however, managed to change its corporate voting structure. Renault can still exercise full voting rights and receives direct input from the French government — as it’s also a stakeholder.
Meanwhile, Nissan holds a paltry 15-percent stake in Renault and lacks the ability to vote using its shares entirely.
With that in mind, it’s obvious to see why the Japanese automaker developed some animosity toward its alliance partner. The Bloomberg article also highlights some genuinely underhanded action on Nissan’s part and lends additional credence to Ghosn’s claim that he’d never have gotten a fair trail in the country — which is supposedly why he escaped before it could take place. It also goes into great detail as to how Greg Kelly got roped into all this, plus the subsequent power struggle between the two automakers that ultimately ended in disaster for all parties involved. It’s a compelling read and offers a comprehensive take on the what was going on behind the scenes in Japan.
Weird, wild stuff.
[Image: Plamen Galabov/Shutterstock]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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