LDN - Business

Not time yet to discuss Nissan chairmanship, Renault's Senard says

[February 14, 2019] By Naomi Tajitsu

TOKYO (Reuters) - The new chairman of French automaker Renault on Thursday said it was not the time to discuss whether he would also take the helm of Nissan, as he arrived in Japan to reaffirm an alliance rocked by the arrest and ouster of former Chairman Carlos Ghosn.

The comment from Jean-Dominique Senard, reported by Japanese media, appeared aimed at avoiding putting further strain on an alliance that some in Japan see as unequal. Senard's visit is the first by Renault's top brass since Ghosn was arrested in Tokyo in November over allegations of financial misconduct.

The downfall of one of the world's best-known executives has stunned the global auto industry and heightened tension between Renault and Nissan Motor Co. Senard is expected to meet Nissan CEO Hiroto Saikawa during his two-day visit.

Senard said it was not the time to discuss whether he would also assume the chairmanship of Nissan, and that he expected discussions to be amicable, Jiji news agency reported, without giving direct quotes.

Senard was appointed chairman of the French automaker three weeks ago, and is also expected to be named to Nissan's board, given Renault's 43 percent stake in the Japanese firm. He is expected to visit Nissan's headquarters in Yokohama on Thursday and Friday to meet with board members and management teams.

The visit is aimed as a friendly, introductory call, according to sources familiar with the matter. But tension has been building between the two sides, with Renault initially backing Ghosn until he was forced to resign as chairman and CEO last month.

Some Nissan executives have long been unhappy with what they see as Renault's outsized influence over Nissan - the Japanese automaker, in turn, holds a 15 percent, non-voting stake in Renault.

A focus now will be on who becomes the next chairman of Nissan, a role previously held by Renault's chairman. Nissan has said one of the reasons Ghosn was able to carry out his alleged fiscal misconduct was a concentration of power in one executive.

Ghosn denies wrongdoing.

DRIVING FORCE

"There are various topics to discuss, but my responsibility is to Nissan stakeholders, to employees and customers and shareholders other than Renault, and Mr. Senard is in the same position," Nissan's Saikawa told reporters on Thursday.

"The main thing is to talk about the future responsibly."

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Jean-Dominique Senard, Michelin Group tyre maker Chief Executive Officer, attends a news conference to present the company's 2018 annual results in Paris, France, February 11, 2019. REUTERS/Philippe Wojazer

Ghosn himself was the driving force in the alliance, which was sealed in 1999 when Nissan was rescued from near-bankruptcy and enlarged in 2016 to include Mitsubishi Motors Corp. Ghosn had been pushing for a deeper tie-up between Nissan and Renault, including possibly a full merger, despite reservations at Nissan.

Senard's appointment in late January helped quell a leadership debate which erupted after Nissan dismissed Ghosn immediately after his arrest while Renault had initially stuck by the executive, and has opened a path for Renault and Nissan re-examine the operations and structure of their alliance.

Joining Renault from tyre maker Michelin, Senard is generally seen by Nissan as a welcome outsider who could provide more balance to the alliance, over which Nissan has said Ghosn held excessive control given his roles as chairman of Renault, Nissan and Mitsubishi Motors, along with being Renault CEO.

Senard's meeting with Saikawa would be the second since they first met face-to-face late last month.

Another person with direct knowledge of the matter said Senard would also meet executives at Mitsubishi Motors, in which Nissan holds a controlling stake.

Meanwhile, Ghosn, in custody at a detention centre in Tokyo for nearly three months, on Wednesday replaced his chief attorney with a legal team headed by one of Japan's most fiery lawyers in a move seen as taking on a more aggressive strategy in fighting his charges, which he denies.

Regardless of the tensions, however, analysts say the automakers need the alliance to compete better with rivals such as Volkswagen AG and Toyota Motor Corp.

Renault announced on Thursday that revenue and profit fell in 2018, hit by collapsing diesel sales, exchange-rate setbacks and a withdrawal from the Iranian market.

Nissan earlier in the week said its annual profit will plumb six-year lows due to waning global sales and an ongoing slump in its U.S. operations.

(Reporting by Naomi Tajitsu; Writing by Ritsuko Ando and David Dolan; Editing by Christopher Cushing)

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