THE PANDEMIC may create a kinder, more united society. That is certainly the effect on the Renault-Nissan-Mitsubishi alliance. It has been vying for the title of the world’s biggest carmaker while teetering on the brink of dissolution. The fear that covid-19 will damage some car firms beyond repair led the union to announce on May 27th that, like a couple about to divorce rekindling lost romance under lockdown, they would give it another go.
The alliance, started in 1999, was an attempt to avoid the pitfalls of a full merger. In carmaking these had often ended in tears. But the cross-shareholdings that held Renault and Nissan together in particular bred discontent. Renault, which is French, owns a controlling 43.4% of Nissan, a Japanese firm; Nissan has a non-voting 15% stake in Renault. Nissan, recently the main source of the group’s profits, resented the French government’s sway through a 15% stake in Renault. The three firms’ engineers rarely saw eye to eye, making joint projects hard to manage. When the man who ran the tie-up, Carlos Ghosn, was arrested in 2018 in Japan, accused of financial misconduct, the end seemed nigh.
The new plan both speeds up and slams the brakes on Mr Ghosn’s ambitions. The ex-boss’s merger plans are dead, says Jean-Dominique Senard, chairman of both the alliance and Renault. So is his...
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