Renault models in a Renault dealership (photo credit: Adobe Stock / )
PARIS/TOKYO, Feb 6 (Reuters) – Renault RENA.PA and Nissan 7201.T are due to unveil details of their agreement on Monday to restructure their more than 20-year-old alliance through a rebalancing of cross-shareholdings and investment of the Japanese group in the future electrical entity of its French partner.
After months of difficult discussions, the French manufacturer has confirmed that it will retain a 15% stake in Nissan, against 43% currently, transferring 28.4% of its Nissan shares to a French trust.
This rebalancing was the condition set by Nissan, which owns 15% of the diamond brand, to rebuild and relaunch the alliance, which Mitsubishi Motors 7211.T later joined as a minority partner.
This partnership forged during the rescue of Nissan by Renault was in danger of not surviving the arrest at the end of 2018 in Japan of its great craftsman, Carlos Ghosn, suspected of financial embezzlement, and his exclusion from the management of the two groups.
Here is a chronology of the main events that have marked the history of their partnership:
1996
Carlos Ghosn becomes Deputy Managing Director of Renault and will contribute to the economic recovery of the French group, which is losing market share and struggling to recover from the failure of merger negotiations with Volvo. In 1997, he unveiled a plan to cut costs by 20 billion francs which would enable Renault to return to profit the following year.
1999
Renault flies to the aid of Nissan, heavily indebted after having suffered losses for three consecutive years and a symbol despite itself of the bankruptcy of the Japanese economy. Carlos Ghosn is the great craftsman of Nissan’s recovery plan (“Nissan Revival Plan”) presented in October, which aims to return the Japanese manufacturer to profitability the following year.
The plan to which Carlos Ghosn linked his future within Nissan is crowned with success, at the cost of the loss of 21,000 jobs, or 14% of the workforce, the closure of several factories and a profound reform of the operation of the business.
2000
Carlos Ghosn was promoted to the post of president of Nissan, then to CEO (in 2001). The Japanese manufacturer contributes from the end of 2020 – and until today – for around half of Renault’s annual net profit.
2002
Nissan announces a new three-year plan, “Nissan 180”, which aims in particular to sell one million additional cars per year worldwide before the end of 2005. This objective will not be achieved, but the group’s operating margin greatly exceeds expectations (more 11% in 2004). At the same time, Carlos Ghosn succeeded Louis Schweitzer as CEO of Renault (in 2005), then as Chairman of the Board of Directors (in 2009).
2008
Nissan again fails to achieve the financial objectives that had been set for it at the end of a new three-year plan. The Japanese company immediately unveiled a five-year plan but had to quickly give it up due to the global financial crisis.
2013
While Carlos Ghosn has become the first leader to hold the position of CEO of two major companies simultaneously, Renault and Nissan unveil a joint project to reduce the development and production costs of their vehicles. Convergence is accentuated in 2014, with a stated objective of 10 billion euros in annual savings by 2022.
2016
Nissan enters the capital of Mitsubishi and takes control of it, offering Carlos Ghosn the management of a third manufacturer.
2017
Nissan and Renault are both reporting record operating margins, although the Japanese automaker hasn’t met all of its targets. The alliance sold more than ten million vehicles that year and is one of the world’s leading manufacturers.
2018
Carlos Ghosn was arrested in Japan on November 19. Suspected of misuse of company assets (the use of Nissan assets for personal purposes) and of not having declared several tens of millions of euros in income over the past decade, he rejects these accusations but he is forced to resign as CEO of Renault, and removed from the presidency of the alliance.
2019
Nissan and Renault are struggling to recover from the explosion caused by the arrest of Carlos Ghosn, who has meanwhile been released on bail. Despite the appointment of new boards of directors, the two manufacturers are seeing their profits melt.
A defector from Michelin, Jean-Dominique Senard takes over the presidency of Renault and the head of the alliance with Nissan and Mitsubishi, while Makoto Uchida becomes CEO of Nissan. Tensions between partners are worsening due to Renault’s desire to establish a closer relationship, even a merger with Nissan, which is opposed to it.
On December 29, a new twist: Carlos Ghosn fled Japan, where he was under house arrest, under four corruption charges, after boarding a private jet while hiding in a trunk. He takes refuge in Lebanon, his native country, where he is subject to a ban on leaving the territory but does not risk extradition.
2020
As the COVID-19 pandemic hits car manufacturers hard, Renault obtains a loan guaranteed by the French state of five billion euros. Luca de Meo becomes general manager of the diamond brand in July, Jean-Dominique Senard retaining the position of chairman of the board of directors.
2022
Luca de Meo unveils a plan to separate Renault’s electric and thermal activities. According to press information, Nissan is asking the French manufacturer on this occasion to reduce its stake to 15% (the same as that held by the Japanese group), in exchange for an investment in the new entity bringing together its electric vehicle activities from Renault, called Ampère.
2023
On January 30, Renault announces that it has reached an agreement with Nissan both on the rebalancing of their cross-shareholdings and on the investment of the Japanese group in the future electrical entity of the French group.
Sources familiar with the matter had told Reuters four days earlier that an agreement on the structure of the new alliance was almost complete and that it should be presented on February 6 in London.
(Written by the Paris and Tokyo offices, French version Tangi Salaün, editing by Blandine Hénault and Kate Entringer)