CommentaryEither Carlos Ghosn is about to prove his true genius once again or commit his first big blunder.

In what is sure to become the ultimate case study for the change-is-good theory of management, the CEO of both France’s Renault and Japan’s Nissan announced earlier this month plans to uproot Nissan’s U.S. headquarters in Gardena, CA, and move it halfway across the country to Franklin, TN.

The wagon train eastward will begin the migration in mid-2006 and arrive in full by 2008 with completion of a new $70 million complex just outside Nashville.

But how many of the auto maker’s U.S. staff will make the journey is questionable, and that’s what makes the move such a gamble for Ghosn.

Nissan hasn’t said how much it expects to save by moving to Tennessee, but some $197 million in tax breaks and incentives, plus the lower living costs and expected jobs reductions that will help cut payroll, should impact favorably on the bottom line. Selling its 43-acre (17 ha) campus in Gardena could net the company an estimated $200 million-plus.

Nissan also says the move will allow management to build closer ties with its mostly Southern manufacturing operations.

It’s hard to blame the auto maker for abandoning the Golden State. High costs are prompting more than 80 businesses and 13,000 jobs to vacate Southern California, according to the Los Angeles County Economic Development Corp.

“Nissan leaving our state shows to us that we still do not have the ideal kind of business environment,” admits California Gov. Arnold Schwarzenegger.

All that said, Ghosn might find he has bitten off more than he can afford to chew right now, unnecessarily risking Nissan’s business in the critical U.S. market at a time when it still is trying to find its legs.

To be sure Ghosn has an incredible track record. His turn-of-the-century resurrection of Nissan, recently declared the world’s “best turnaround” in a Pricewaterhouse Coopers/Financial Times survey of international executives, has earned the man near mythical status.

Under his regime, the Japanese auto maker has increased annual sales by 1 million vehicles since 2001, eliminated all debt and locked up a healthy 8% profit margin.

But Ghosn added the CEO job at Renault to his plate in May, and heading two major auto makers is a huge task, particularly in light of the French car maker’s recent struggles. Renault, saddled with an aging product portfolio, has seen its profit margin and market share slip, while its stock has degenerated into the worst performing of any car manufacturer in Europe.

Nissan, meanwhile, probably doesn’t need the distraction in the U.S., where it faces several critical new-vehicle launches in coming months.

Some say up to 80% of Nissan’s 1,300 Gardena workers likely will refuse to make the move to Tennessee, although the company expects more than half to relocate.

Either way, that’s significant turnover in a short period, and a huge brain drain at a time when Nissan – and Ghosn – may need all the seasoned help it can get.