The possible merger between the French car manufacturer Renault and the US-Italian group Fiat Chrysler has caught Nissan cold. „This is a badly considered and bad plan,“ said today a Nissan confidant. The „alliance“ between Renault and Nissan, which has existed since 1999, does not work that well any more – now observers expect the partners to move even further apart.
„Nissan does not seem to have been informed,“ said analyst Satoru Takada of Tokyo consulting firm TIW. „This is unpleasant for them and could create unnecessary distrust of Nissan managers to Renault.“ Nissan CEO Hiroto Saikawa gave himself today cool: He was „open to constructive talks to strengthen the alliance“ with Renault. The topic is likely to be discussed at his meeting with Renault CEO Jean-Dominique Senard on Wednesday.
Merger plans in a delicate phase
The merger plans with Fiat Chrysler (FCA) are in a delicate phase: Nissan’s profit fell to its lowest level in eight years in the past fiscal year and the forecast for the current year is grim. Former Board Chairman Carlos Ghosn is currently awaiting trial in Japan – Nissan accuses him of a host of financial crimes, and his former foster son Hiroto Saikawa even blamed Ghosn’s „excessive investment“ for the poor numbers.
Ghosn was the staple that kept Renault and Nissan together. Since his arrest in November, the relationship between the French and the Japanese has cooled significantly.
„Door is open“
However, Renault and FCA could use Nissan well as a third party in the league. „The door is open to Nissan,“ assured negotiators in Paris. An industry expert said, „Nissan is still a big part of the puzzle, because they are good at doing business in China, where neither Renault nor FCA are strong.“ And Nissan would bring with it the smaller Japanese partner Mitsubishi, which sells many cars in Southeast Asia.
In any case, the Renault Board of Directors signaled interest in the merger proposal. The plan could strengthen the Renault Group’s position in the industry and add value to the alliance. A merger with Fiat Chrysler would create the world’s third largest carmaker and challenge market leaders Volkswagen and Toyota. VW did not want to comment on the announcement so far.
Paris is reacting positively positive
„This is a project that we are quite positive about,“ the French government welcomed the merger plans with reservations. It is good for Europe to have an „industrial giant“. However, France must look closely at the terms of the business. The French state is the largest owner of the automaker with 15 percent. It is precisely this participation, meanwhile, in Italy in the co-governing right Lega for criticism.
Investors seem to prefer the latter: Renault and FCA share prices shot up with the official release of the merger plans – Nissan’s price edged up one percent.
