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Nissan, Renault in talks to merge as one company

Nissan and Renault have been tied together as an alliance for nearly 20 years, but now the Japanese and French automakers are discussing whether to merge. Bloomberg, citing unidentified sources familiar with the confidential talks, reports that the idea is to form a larger, single publicly traded company to better compete against giants like Toyota and Volkswagen. It would also mark the end of the alliance that first began in 1999 and also includes Mitsubishi, in which Nissan acquired a controlling interest in 2016. A full merger would help the companies pool resources to develop electric vehicles, autonomous vehicles and car-sharing services. It would involve Nissan giving Renault shareholders stock in the new company, with Nissan shareholders also gaining shares in the new company, Bloomberg reports. The new company would be run by Carlos Ghosn, the current chairman of both companies. But any such merger, as you might expect, would be complicated, in part by geopolitics. The French government owns a 15-percent stake in Renault, and both the French and Japanese governments might be reluctant to let go of their respective home-grown brands. Currently, Renault owns a 43-percent stake in Nissan, while Nissan owns 15 percent of its French partner. Reuters reported recently that Ghosn proposed buying most of the French government's stake in Renault as part of plans for a closer tie-up. The Renault-Nissan-Mitsubishi alliance already has been working to establish a $200 million mobility tech fund to invest in startups, a reflection of how seismic changes in the auto industry have left many legacy companies scrambling to stay current. Nissan in 2016 paid a reported $2.3 billion to acquire 34 percent of Mitsubishi in order to share platforms, technology, manufacturing and other resources. Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. Image Credit: Patrick T. Fallon/Bloomberg Earnings/Financials Government/Legal Green Mitsubishi Nissan Renault car sharing merger

Ghosn's legacy: one of the auto industry's most effective execs

"Bob Lutz ... estimated that carrying out the Nissan operation would be the equivalent, for Renault, of putting $5 billion in a container ship and sinking it in the middle of the ocean." So wrote Carlos Ghosn in "SHIFT: Inside Nissan's Historic Revival," which was published in the U.S. in late 2004. Two points about that observation: It is in keeping with Lutz's "Often wrong but never in doubt." It shows that Ghosn is a remarkable executive, given that he was able to take Nissan from the edge of financial oblivion to one of the foremost automotive companies (although with alliance partners Renault and, more recently, Mitsubishi). In 1999, Ghosn created what was named the "Nissan Revival Plan." It could have just as well been called the "Nissan Resuscitation Plan." Things were that bad. Now Ghosn is in the midst of legal trouble, accused of financial improprieties of some sort. There is no indication that this is at anything near the scale of what happened at Volkswagen Group. There's malfeasance. And then there's malfeasance. It is likely that this is going to be the end of Ghosn's career, but at age 64, and as a man who has spent nearly the past quarter-century essentially on airplanes, it is probably a good time to leave the stage. What his next act will be — to court or even prison — is an open question. But arguably, Ghosn's performance in the transformation of Nissan and Renault, which also needed some strong medicine to keep it from collapse in the early '00s (although one suspects that the French government would have done its damnedest to keep it propped up), makes him one of the all-time most-notable executives in the auto industry. Ghosn closed plants in both France and Japan and he worked to dismantle the Nissan keiretsu network of interlocked companies, things that were absolutely unthinkable. He established plans with stretch goals in their titles, like the "20 Billion Franc Cost-Reduction Plan," and worked with his people to achieve them, despite the pushback that seemed to come along with the announcement of the plan. As in, as he recalled in SHIFT, "Some people said, 'He's off the deep end. He's raving mad. Doesn't he know that at Renault you set the most conservative goals possible so you can be certain to reach them?' My answer to that sort of thinking was 'You're going to get what you ask for. If you set the bar too low, you'll be a low-level performance.

Carlos Ghosn changes to hotshot attorney and a new defense strategy

TOKYO — Carlos Ghosn's chief defense attorney Motonari Otsuru resigned and was replaced by a team that includes hotshot lawyer Junichiro Hironaka, in a change of strategy from the ousted Nissan Motor chairman three months after his arrest. Ghosn, Nissan's one-time savior, has been held in detention since his Nov. 19 arrest. He's been indicted and accused of under-reporting his salary and breach of trust. He has denied the charges. The once-feted auto executive hired Hiroshi Kawatsu as head of a new defense team, his office said on Wednesday. Hironaka, 73, has won several high profile cases, helping acquit senior lawmaker Ichiro Ozawa and senior bureaucrat Atsuko Muraki. Hiring Hironaka would mean a more aggressive legal strategy, said Nobuo Gohara, a former prosecutor. Otsuru previously led the special prosecutors' office that is now handling Ghosn's case. "Otsuru was miscast. He worked at the heart of the special prosecutors office so he was not someone who was going to go after them aggressively," Gohara said. "Hironaka is an experienced defense lawyer who has won a number of cases. He will mount a more thorough and aggressive defense." Otsuru's office confirmed his resignation in a statement, but gave no reason for the move. A second member of Ghosn's defense team, Masato Oshikubo, had quit, it said. Go Kondo, Ghosn's third defense lawyer, was unavailable for comment. Ghosn released a short statement thanking Otsuru for his team's "tireless and diligent work," and called him a "very capable and intelligent man and lawyer." The sudden change in attorneys comes ahead of the expected start of informal meetings with prosecutors and judges to discuss pretrial preparations, an indication that there will be no new charges against Ghosn. "As we begin the trial phase, I have decided to engage Hironaka-sensei as my legal counsel," Ghosn said, using an honorific suffix. "I look forward to defending myself vigorously, and this represents the beginning of the process of not only establishing my innocence but also shedding light on the circumstances that led to my unjust detention." Ghosn, 64, told the Nikkei newspaper last month that Nissan executives opposed to his plans for closer ties with automaking partner Renault SA had plotted to remove him. Ghosn was widely credited with rescuing Nissan from near-bankruptcy after he was brought over to Japan in 1999 by Renault after the French automaker bought a chunk of Nissan.