On 20 November 2018, Nissan Motor Co shares were hit by a wave of sell orders after the arrest of chairman Carlos Ghosn sent shockwaves through the company and raised fresh doubts about the future of Japan’s No. 2 automaker and its alliance partners.
Nissan said in a late-night statement on Monday that Ghosn had been arrested on allegations of financial misconduct and would be removed from the board later that week. Ghosn also served as chairman and chief executive of Renault, Nissan’s French partner.
The fallout immediately put pressure on the wider Franco-Japanese partnership. Ghosn had been the central figure behind the alliance and had previously pushed for a deeper integration before stepping back from day-to-day operational leadership.
Japanese media, citing prosecutors, reported that Ghosn and Representative Director Greg Kelly were suspected of conspiring to understate Ghosn’s compensation for five years beginning in fiscal 2010. The reported figure was said to be about half of the actual 9.998 billion yen, or $88.9 million.
Mitsubishi Motors Corp, another member of the same partnership, was also left untraded early on Tuesday as sell orders piled up. The exchange rate cited in the report was $1 to 112.4400 yen.
The arrest marked a major escalation in a corporate scandal that threatened to reshape Nissan’s leadership and the structure of its global alliance.
