Features
11 juin 19

Nissan – Renault relationship under increasing pressure

Renault’s intentions to merge with FCA met with some resistance from the French Government (not keen on losing its influencing power on the carmaker) and from Nissan (pushing for more autonomy in the alliance). As reported in GlobalFleet’s article (read here) the deal was off pretty quickly, as FCA realised there were too many family feuds to solve in order to make the merger work.

Governance

Nissan’s attitude certainly didn’t bring the Japanese any closer to the French. The Japanese are still reworking their corporate governance structure, said to make sure the Ghosn affaire wouldn’t repeat itself. Behind the screens however, a fierce battle for power and control has dominated the relationship of the 2 OEMs.

The latest example is Nissan’s proposal to create three specialist committees deciding matters of nominations, remuneration and audits, moving away from statutory auditors. Whilst, for Nissan, it’s a tool to counter French influence, for Renault, this could only work if Renault directors were to be appointed in these committees. Needless to say the Japanese are not entirely on board with this idea.

Blocking

Renault has already announced that, unless Nissan agrees with the conditions, it will abstain from voting at the upcoming shareholder meeting, which comes down to blocking the motion: Renault owns 43% of the votes. Nissan Motor’s President and CEO Hiroto Saikawa finds Renault’s stance “most regrettable”. He adds that “…such a stance runs counter to the company's efforts to improve its corporate governance.”

FCA

Whereas the Renault-FCA deal was cancelled essentially because of the French Government’s reticence to support the merger, it’s obvious that Nissan’s lack of enthusiasm about its precondition, a merger between Renault and Nissan, has played an important part. The Japanese have understood that, even if their leverage is insufficient within the alliance, it is strong enough to highjack Renault’s growth playbook, which involves close partnerships with other major OEMs.

 

Authored by: Yves Helven