New Nissan bid to end Renault control and curb French clout

Nissan Motor Co’s union of Japanese workers branded as “unacceptable” the French government’s move to secure double voting rights in the carmaker’s alliance partner Renault and supported negotiations to find a solution to the power struggle, it said on Wednesday. A crucial meeting is to take place on 11 December, in which Emmanuel Macron and Carlos Ghosn, chief executives of both carmakers, are to decide what is the best direction to take so this long lasting alliance still works.

Nissan’s Japanese arm is having concerns with the French government over its involvement in the running of Renault.

Nissan now owns a non-voting 15 percent of Renault.

A bigger stake is just one of various options the Japanese group is considering on the back of an escalating stand-off with Paris, which last spring bought additional shares in Renault to push through arrangements that would give long-term investors double voting rights at the French company.

If the French government is really prepared to take this fight to the wire, it may be able to lift its voting stake in Renault to perhaps 20 or 25 percent. “But to do so, it is necessary that Nissan’s independence is maintained and assured, and not dominated by a third party”, the person said.

The announcement followed a source-based report by the Nikkei Asian Review Monday, which said Nissan is looking to raise its stake in Renault to 25 percent. Instead, Nissan is seeking to neutralise Renault’s control of the Japanese carmaker through written undertakings. It’s worth noting that Yoshihide Suga, Prime Minister Shinzo Abe’s influential cabinet secretary, represents Nissan’s hometown of Yokohama in Japan’s parliament.

Nissan is threatening to end a 2002 agreement defining the alliance if the government does not sufficiently limit its influence, French media said. “What the French intervention has revealed is that the current alliance structure is inadequate”.

Renault-Nissan India operations have their manufacturing plant in Oragadam near Chennai and the plant has a capacity of four lakh vehicles per annum.

Nissan wants signed commitments that Renault will not intervene in its governance or operations, according to Le Figaro – curtailing the French company’s influence.