- CEO Carlos Ghosn was in town to deliver a speech to the Detroit Economic Club, but his message was aimed more squarely at the media.
This past summer, Ghosn, arguably the world’s most coveted automotive CEO, was at the center of high-level talks with, after GM’s top individual shareholder, Kirk Kerkorian, prodded management to explore joining the - Alliance. Those negotiations broke off abruptly when GM said it believed Renault-Nissan would benefit more than it would from any tie-up.
Despite the rejection, Ghosn, who saved Nissan from near bankruptcy and has overseen a quintupling of its market value in the seven years since it was joined with Renault, continues to preach the merits of the Alliance with almost evangelical zeal.
But as Ghosn emphasizes several times during his speech last week and in a subsequent meeting with reporters, he also reads the press.
And he was stung by reports that characterized the scuttled talks with GM as a high-stakes poker game between himself and GM CEO Rick Wagoner or a power grab by an ego-driven Ghosn bent on ruling the automotive world.
“I read your articles,” he says. “Some of you said, ‘You know what, he’s bored. Tokyo, Paris, he wants something else,’ or that I want to build an empire. Every single story.”
But Ghosn contends the GM talks – and everything else he does, for that matter, were all “about building value” for shareholders, not about creating a personal fiefdom.
His point to the Detroit Econ Club crowd? The Renault-Nissan Alliance works, and it can work for others if they’ll just follow its “sacred principles.”
Those include keeping the individual brands, products and corporate identities of the allied partners intact, as well as accepting and maintaining independent management structures.
The partners also must vigorously seek and develop synergies, and above all, be transparent, he says. There can be no dominance of one company by the other.
“The Alliance is a structured, disciplined partnership,” he says. “There is no blurring between Nissan and Renault. There (is) no winner and no loser.”
Since the Alliance was formed, Renault’s capitalization has tripled to $32.6 billion and Nissan’s has increased from $9.7 billion to $52.3 billion.
Together, Renault-Nissan says it is No.2 worldwide in profitability.
“You can look at the facts and judge for yourself, but I believe the Renault-Nissan Alliance is a model that works,” Ghosn says. “No merger, no acquisition is working as well as our Alliance.”
It’s clear Ghosn believes deeply in the new business model that is Renault-Nissan. But passion often gets confused with ego, and observers sometimes find it difficult to tell which is the case with the group’s CEO.
“If I was believing always what I read, I would be believing things about myself which I know are wrong,” he says.
So in the future, Ghosn plans to keep his guard up, even while he continues to preach chapter and verse from the book of Renault-Nissan.