Nissan moved to assert itself in the Renault-Nissan-Mitsubishi alliance after the arrest of chairman Carlos Ghosn, arguing that the current structure does not match its scale or sales.
The Japanese carmaker has long viewed itself as the weaker side of the partnership Ghosn built over 19 years after rescuing Nissan from near-bankruptcy. The alliance was expanded to include Mitsubishi Motors in 2016, but the balance of power has remained a source of tension.
While Nissan pushed for change, the French and Japanese governments publicly backed continuity on Wednesday, saying they wanted to preserve the alliance after Ghosn was detained on suspicion of financial misaccounting. Nissan has said it will dismiss him as chairman on Thursday.
A senior Nissan executive told reporters in Tokyo that the company wanted to restore what he called the original idea of a win-win relationship. He said the partnership should be “a more equal relationship than before.”
The ownership structure remains heavily tilted toward Renault. Renault holds 43.4 percent of Nissan, while Nissan owns a 15-percent non-voting stake in Renault. The French state is Renault’s largest shareholder with 15 percent.
The Nissan executive said one option would be reducing Renault’s stake in Nissan. That would mark a significant shift in an alliance that Ghosn personally shaped and had been trying to deepen further before his arrest.
Ghosn, who is Brazilian, Lebanese and French, had been exploring a full Renault-Nissan merger before his detention, with backing from the French government. A French official said Paris had asked him to strengthen the alliance, but added that the government still did not know the details of the case against him.
“It’s difficult to see what’s behind all this - whether it’s all true, or whether it’s been swiftly brought out to scupper the alliance or take control.”
Auto analyst Thomas Besson of Kepler in Paris said Nissan’s plan to remove Ghosn “appears to be an indirect way of formally refusing a financial merger that Ghosn was advocating”.
The dispute is complicated by the French state’s influence in Renault, including double-voting rights, and by wider suspicion on both sides. In Japan, officials worry France may ultimately seek control of Nissan and Mitsubishi. In France, there are concerns that Ghosn may have been targeted to weaken French influence.
A senior source familiar with Japanese government thinking said there was a sense of crisis at the Ministry of Economy, Trade and Industry over the possibility that Nissan and Mitsubishi could be taken over by the French government.
French Finance Minister Bruno Le Maire tried to calm the situation, saying stability was essential for both countries. He said he wanted to see the evidence before drawing conclusions and planned to meet Japan’s economy and industry minister on Thursday.
“At this stage, we do not have any evidence to support the accusations against Mr Carlos Ghosn,” Le Maire said. “I would like to emphasize the Renault board’s request that Nissan share all the evidence available to it.”
Renault had already moved on Tuesday to name its chief operating officer and a senior board member to stand in for Ghosn, but stopped short of removing him while it waited for more details. That decision could give the company time to accelerate a permanent succession process.
Ghosn, one of the auto industry’s best-known executives, had long dominated the alliance even as he complained that the French government’s stake in Renault made deeper integration difficult. Nissan CEO Hiroto Saikawa said on Monday that Nissan was the victim of Ghosn’s alleged misconduct.
But Nissan itself was also facing scrutiny. On Wednesday, the Asahi newspaper reported that prosecutors were considering bringing a case against the Japanese automaker as part of the same financial misconduct matter.
The allegations against Ghosn center on compensation that prosecutors say was understated at Nissan over five years from 2010. They said Ghosn and Representative Director Greg Kelly conspired to report only about half of the actual 10 billion yen, or $89 million.
Ghosn and Kelly have not commented on the accusations, and Reuters said it had not been able to reach them. Kyodo News reported on Wednesday that the Tokyo District Court had decided both men would remain detained for a further 10 days.
Japan’s Nikkei business daily also reported on Tuesday that Ghosn received about 4 billion yen in share price-linked compensation over a five-year period to March 2015, but that the amount was not disclosed in Nissan’s financial statements.
Investor concern over the alliance intensified as the scandal spread. On Wednesday, Renault shares rose 1.3 percent after falling more than 9 percent during the week. Nissan closed up 0.4 percent after dropping nearly 6 percent the previous day, while Mitsubishi Motors fell 1 percent after losing nearly 7 percent on Tuesday.
The alliance remains strategically important because it helps the automakers share development costs and build products more efficiently at a time when the industry is being reshaped by changing consumer demand and heavy investment in automated and internet-connected vehicles.
For that reason, both governments have continued to call for calm. The top Japanese government spokesman said the alliance was “a symbol of Franco-Japanese industrial success” and urged a “stable relationship” among the three automakers.
Reuters reported that Nissan’s internal investigation began after a whistleblower tip-off and found alleged wrongdoing including personal use of company money and years of under-reporting of earnings.
Ghosn was arrested by Japanese prosecutors, who said the alleged under-reporting covered five years from 2010 and involved compensation of about 10 billion yen ($89 million). The case has left the future of the alliance under intense investor and political scrutiny.
Reporting by Daniel Leussink, Sam Nussey and Elaine Lies in Tokyo and Laurence Front, Michel Rose, Gilles Guillaume and Inti Landauro in Paris; additional reporting by Mayuko Ono and Taro Fuse; editing by Luke Baker, Mark Potter and Susan Fenton.
