PARIS -- A year ago, then-Renault Chairman Carlos Ghosn stood before shareholders in Paris and pledged to buttress the automaker’s two-decade partnership with Nissan. He praised the strength, solidity and pragmatic nature of their relationship and vowed to eliminate all "reasonable doubt" about the durability of the alliance.
On Wednesday, Renault shareholders will gather in the same cavernous hall in the French capital and again consider the company's relationship with Nissan. But the circumstances have changed radically. Ghosn is gone, arrested in Tokyo and charged with financial crimes, and the alliance he nurtured is under unprecedented strain.
When Renault's new chairman, Jean-Dominique Senard, takes the stage, he’ll be pressed to explain whether the world’s biggest auto-making alliance can survive at all, especially after the French company’s failed effort to combine with Fiat Chrysler Automobiles NV pushed the partners further apart.
"Senard is in a tricky situation," said Denis Branche of Paris-based Phitrust, a Renault shareholder that opposed the deal with Fiat Chrysler Autobomiles. "He made Renault's governance healthier, but there is still work to do. And the issue of the governance of the Renault-Nissan alliance remains."
An open struggle has broken out between the French and Japanese carmakers, and Senard's past public gestures of goodwill toward Nissan CEO Hiroto Saikawa changed into finger-pointing. The two sides are sparring over governance changes at Nissan, an apparent tit-for-tat after it refused to support the FCA deal.
Complicating matters even further is the mounting pressure on Saikawa ahead of Nissan's shareholder meeting on June 25. Corporate-governance advisers Institutional Shareholder Services and Glass Lewis said investors should vote against Saikawa's re-election because of his close association with Ghosn.
Asked about the reports, Saikawa said: "I believe I should follow through with my responsibilities and I hope my stance is understood."
Renault's Senard is still smarting from the unraveling of the merger effort with FCA. In a dramatic move, FCA pulled its offer after the French government, Renault's most powerful shareholder, sought a delay in talks to persuade Nissan to explicitly support the deal. Senard has since threatened in a letter to block critical governance changes at Nissan's annual shareholder meeting on June 25.
Nissan is "trying hard" to make progress in reaching a common understanding with Renault, Saikawa said in an interview Monday.