One of the most well-known automotive executives, Carlos Ghosn will step down as CEO of Nissan in order to champion the Renault-Nissan-Mitsubishi Alliance.
While ceding his role as Nissan’s CEO, Ghosn will remain CEO of Renault and of the entire Alliance, while also continuing to serve as Board Chairman for all three carmakers. The move suggests particular concerns about French-based Renault, which Ghosn will be closely involved in running. “There are still lots of things to be done inside the company in order to make its growth sustainable and lasting and solid”, he said.
Ghosn joined Nissan when the Renault-Nissan alliance was formed in 1999, and became its CEO in 2001. Already a rarity as a foreign executive in Japan, Ghosn became famous both for his cost-cutting expertise and zeal for reviving struggling brands. He is credited with bringing Nissan back from the brink of financial ruin, and also took the lead in 2016’s acquisition of a controlling interest in Japanese carmaker Mitsubishi.
Today Nissan is the strongest of the three, and has repeatedly bested Renault in vehicle sales and profits. Mitsubishi is still recovering from a mileage cheating scandal. “Ghosn is likely to focus on strengthening and raising profitability at all the alliance members so that they are not overly dependent on Nissan”, said Takeshi Miyao, Asia Managing Director at consultancy Carnorama.
Ghosn will be replaced at Nissan by Hiroto Saikawa, a 40-year veteran of the company. He was named Chief Competitive Officer in 2013, and became Co-CEO in 2016. The CEO appointment was unusually swift. “The timing is a bit surprising”, Miyao remarked. “It appears Ghosn has decided very quickly that Saikawa is the right person to lead the company.”
Though no longer CEO of Nissan, Ghosn will still have his hands full. Adding Mitsubishi to the alliance boosted the group’s annual combined sales to 9.3 million vehicles, bringing it nearly to the level of Toyota and Volkswagen. But as Reuters reports, forming the three-way strategic partnership “has brought new opportunities to benefit from scale but also the challenge of balancing the interests of all three automakers”.
One lingering issue is the effort to deepen capital ties with Nissan, a matter complicated by the French government unexpectedly increasing its stake in Renault in 2015. Moreover, stricter emissions regulations are creating integration difficulties between Nissan and Renault. Ghosn said that in addition to leveraging scale to cut costs, the three carmakers will be looking to strengthen their competitiveness in electric and self-driving cars. In Ghosn’s favour, he was ahead of the curve in mass-market electric vehicles (EVs), having brought Nissan’s LEAF EV to market in 2010.
