Triple alliance between Renault, Nissan and Mitsubishi uncertain
Author: Mario Schmidtgen
Cooperation reviewed due to allegations of fraud
After Renault’s top manager Carlos Ghosn was arrested and dismissed, the Japanese car manufacturer Nissan wants to review its cooperation with the French company. This was indicated by a statement by Nissan boss Hiroto Saikawa, according to the Japanese news agency Kyodo on the appeal of an insider. Saikawa should have said at a meeting with employees that the alliance with Renault was “not equal”.
On November 19, Ghosn was arrested because he and another manager allegedly misdocumented cash withdrawals in public reports to the Japanese stock exchange. In Ghosn’s case, the charges were too low. While he continues to work for Renault as CEO, he has already been dismissed from Nissan. Mitsubishi is also likely to fire Ghosn at the upcoming board meeting, according to Japanese media.
Cooperation is unsteady
Ghosn had previously formed a triple alliance between Renault, Nissan and Mitsubishi. According to the Japanese, the French have to decide whether the cooperation should continue. Nissan has accounted for about 50 percent of Renault’s turnover in recent years. Renault owns 43.4 percent of Nissan and 34 percent of Mitsubishi. Nissan owns 15 percent of Renault, but has no voting rights.
The French group has already initiated internal investigations against the former top manager. According to the French Minister of Economy and Finance, Bruno Le Maire, an audit of the company’s accounts should uncover questions of payment and possible misappropriation of the company’s assets.
The state is also affected by the incident as it owns a 15 per cent stake in the French carmaker. According to Le Maire, no evidence has yet been found for the allegations from Japan against Ghosn. After Renault was informed about the allegations, a provisional leadership was directly appointed, but Ghosn was initially kept in the chief post. If the allegations turn out to be true, he will also leave Renault.
Distortion of income and pension provision
Furthermore, the Japanese media reported that Ghosn had distorted his income in official reports for more than five years since 2011. He supposedly reported a total of 5 billion yen (around 40 million euros) too little salary. Ghosn rejected the allegations, but under Japanese criminal law he can still be held without trial for up to three weeks.
The Japanese business newspaper “Nikkei” also writes that Ghosn has been hiding an employee-financed old-age pension of around 8 billion yen for eight years. In deferred compensation, part of the salary is set aside for the pension promise. For Ghosn the figure is supposed to account for around one billion yen per year. From the point of view of the public prosecutor’s office, he should have noted this in the reports to the stock exchange.