The arrest last week of Carlos Ghosn by the Japanese authorities on accusations of financial misdeeds has revealed fissures in the Renault-Nissan-Mitsubishi alliance.
Renault and Nissan (which holds a controlling interest in Mitsubishi) remain separately listed companies, but they are connected by a complicated web of cross-holdings and shared functions, which could be costly and complicated to undo. Nissan executives have reportedly grown increasingly frustrated by what they perceive as a lack of control over their own company.
Ghosn, as chairman of Nissan and Mitsubishi, chairman and CEO of Renault, and chairman of the overall alliance, had been devoting an increasing percentage of his time to ensuring that the alliance, which is set to mark its 20th anniversary next year, would continue after his departure. He had accelerated cross-company functions and released an ambitious five-year plan that would grow sales from 10.6 million vehicles in 2017 to 14 million in 2022 -- and develop costly and complicated technologies such as robotaxis.
Here are the main points where the companies converge:
This is the Dutch-registered company that creates the alliance's mid- and long-term strategy, although it has limited decision-making power over the two main partners. Its powers include approval of certain strategic and product plans, deciding which components and vehicles are to be shared, financing policies such as risk management; and the creation of cross company teams. Renault and Nissan each have four members of the alliance board of directors.
Ownership and governance
Renault owns 43 percent of Nissan, which holds 15 percent of Renault shares -- and no voting rights on the French company's board, although it has two members on it. The current power-sharing arrangement dates to December 2015, when the alliance partners and the French government -- the largest single shareholder in Renault -- agreed to let the state increase its share of Renault to 20 percent to ensure it had double voting rights, what became known as a "blocking minority." To limit the influence of the French government on Nissan, Renault agreed to hold no more than four seats out of nine on the Nissan board, and approve resolutions proposed by the board for "the appointment, dismissal and remuneration of board members." The negotiator for the government was Emmanuel Macron, then the finance minister and now president; for Renault it was Carlos Ghosn, and Hiroto Saikawa represented Nissan.