Renault faces shareholders as Nissan crisis deepens
Date created :
Bosses at French carmaker Renault were expected to face robust questioning by shareholders Wednesday following the collapse of merger plans with Fiat Chrysler, and its troubled alliance with Nissan mired in fresh crisis.
Renault has for years tied its strategy to a partnership with Japan's Nissan but the alliance has come under unprecedented strain following the shock arrest and ouster of Carlos Ghosn, which has cost shareholders dearly.
Since the arrest in November of Ghosn, who built up the alliance with Nissan and Mitsubishi into the world's top-selling auto company, shares in Renault have fallen to their lowest levels of around 55 euros ($62).
The collapse of last week's proposed merger with Fiat Chrysler has dealt Renault a further blow.
The crisis comes as carmakers across the globe grapple with a shift to electric and hybrid vehicles, with the industry spending billions to develop cleaner technologies -- without any guaranteed returns.
Some shareholders have pointed the finger at Renault's board for not exercising enough oversight over Ghosn, who is awaiting trial in Japan on charges of financial misconduct at Nissan.
At the meeting, former Michelin boss Jean-Dominique Senard, who took over as Renault chairman earlier this year, will be asked to lay out his strategy for shoring up the alliance, just weeks after his plans for closer management integration were rejected by the Japanese firm.
Thierry Bollore, Ghosn's successor as Renault CEO, will also be at Wednesday's meeting.
"The board clearly failed to exercise its responsibility in the best interests of shareholders.. which allowed the eruption of the recent crisis," said Phitrust, a Paris-based shareholder group, in a statement ahead of the meeting.
The French government, which holds a 15-percent stake in Renault, announced last week that Renault would bring a case against Ghosn after identifying 11 million euros of questionable expenses at the alliance's Dutch subsidiary RNBV.
- Tensions with Nissan -
Late last month, Fiat-Chrysler stunned the auto world by proposing a merger with Renault that -- together with Nissan and its other Japanese partner, Mitsubishi Motors -- would create the world's biggest car giant.
But the deal collapsed suddenly last week, with the Italian-American carmaker blaming political resistance from the French state, which holds a 15-percent stake in Renault.
French Finance Minister Bruno Le Maire said it was "legitimate" for Paris, as the "shareholder of reference" in Renault to have a say in the proposed tie-up and that Renault should focus on shoring up its relationship with Nissan before pursuing mergers with other firms.
The tensions with Nissan and the collapse of the merger talks have raised questions over the future of the French carmaker, which last year sold 3.9 million vehicles, more than half of them outside of Europe.
Nissan and Renault have been partners for more than 20 years after Ghosn stepped in to save the Japanese firm from the verge of bankruptcy by tying it to the French manufacturer.
Renault is the dominant partner in terms of the capital structure -- owning 43 percent of Nissan -- but the Japanese firm has outsold its French ally in recent years, sparking complaints in Japan that the alliance was lopsided.
Last year, Renault's profits fell sharply, plunging 37 percent from a record 5.1 billion euros ($5.75 billion) the previous year in its first results since Ghosn's arrest.
? 2019 AFP