France: Renault-Nissan Alliance Must Change or Die

The Renault-Nissan-Mitsubishi alliance is unsustainable without changes in structure, declares Bruno Le Maire, France’s minister of the economy and finance.

“The status quo is not possible,” Le Maire insists during this week’s meeting in Paris of the Organization for Economic Cooperation and Development. He did not indicate what changes are needed.

The comment comes as outside Nissan Motor Co. director Keiko Ihara tells Reuters that none of the Nissan board candidates from either company is calling for action on merging the companies.

Renault and the French government, which owns 15% of the French carmaker, have been pressing the Japanese carmaker to consider integrating the companies, perhaps by transferring their control to a co-owned holding company.

But Nissan has balked at melding the two companies and Mitsubishi Motors Corp., in which Nissan holds a 34% controlling stake. Earlier this month Nissan CEO Hiroto Saikawa opined that “now is not the time” to make such a move.

The Japanese carmaker has become increasingly restive over the past two years with the alliance’s lopsided power balance. The company worries that Renault’s current dominance of their alliance will carry over into any new integrated structure.

Until the fiscal period ended March 31, Nissan for years contributed roughly two-thirds of the alliance’s revenue and profits. But Nissan’s 15% nonvoting stake in Renault compared with Renault’s 43% voting stake in Nissan.