Nissan reportedly mulling breaking away from Renault

Nissan reportedly mulling breaking away from Renault

Nissan executives have examined the possibility of breaking away from Renault amid concerns that relations with the longtime French partner have turned dysfunctional after the ouster of former chief Carlos Ghosn.

Since last year, according to sources, Nissan has been exploring the pros and cons of sustaining the alliance, particularly when it comes to engineering and technology sharing.

Those studies pre-date Mr Ghosn’s escape from Japan and were preliminary, so no decision has been made, it is understood.

It’s unclear how feasible any separation would be, given that Renault is Nissan’s biggest shareholder.

Still, the comments illustrate the fragile state of the relationship between the Japanese and French car giants after Mr Ghosn, who balanced the world’s largest automotive alliance for years as head of both companies, was arrested in late 2018 in Japan on allegations of financial misconduct.

Mr Ghosn’s legal odyssey took a dramatic turn recently when he fled Japan for Lebanon and became the world’s most famous fugitive.

Since Mr Ghosn’s downfall, the two carmakers have struggled financially — their shares were the two worst performers among major carmakers last year — and drifted apart at a time when the costs of electrification and autonomous driving are pressuring incumbent carmakers to team up or consolidate.

Relations between the two companies are “broken and likely beyond the point of repair,” Evercore analyst Arndt Ellinghorst said.

Nissan didn’t immediately respond to a request for comment, as it was a holiday in Japan. Renault declined to comment.

The Financial Times reported earlier that Mr Ghosn’s escape from Japan had spurred Nissan executives to accelerate secret contingency plans to potentially split from Renault.

The board of the Renault-Nissan alliance is scheduled to meet on January 30 and the meeting could lead to announcements about joint projects, according to another source.

Renault pledged, back in February of last year, to make its 20-year-old alliance with Nissan “irreversible”, after the shocking arrest of Mr Ghosn exposed deep rifts on both sides.

That goal now looks further away than ever, with Mr Ghosn’s dramatic escape to Lebanon and his repeated denials of the charges reopening old wounds, and neither firm succeeding in bridging the political and governance divide between France and Japan.

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