Coverage: Nissan Motor chair Ghosn is arrested
The arrest of Nissan Motor Co. Chairman Carlos Ghosn sent shockwaves through the business world and threw into doubt the future of Japan’s No.2 automaker and its global alliance.
David Kiley of Forbes had the news:
Ghosn was targeted by a whistle-blower who gave authorities information on Ghosn’s compensation, as well as charges that he has been using company assets for his own personal use. These are practices, especially using company assets for non-business use, that have taken down other CEOs who come to blur the lines between company assets and privileges of position with their personal lives and wealth.
Along with Ghosn, Nissan board director Greg Kelly was also accused by Japanese authorities of misconduct and wrongdoing. Ghosn, 64, is CEO of the Nissan-Renault-Alliance, a structure in which Nissan and Renault own substantial stakes in one another and Nissan owns a controlling stake in Mitsubishi, with Ghosn the architect behind all three companies. With Ghosn apparent ouster upon us, much speculation will be directed upon the future of the Alliance.
Nissan issued a statement that it was being recommended that Ghosn and Kelly be removed from their positions.
Jethro Mullen and Daniel Shane of CNN Business reported that Renault’s stock plummeted:
Shares in Renault, whereGhosn is chairman and CEO, plunged as much as 13% in Paris. Renault said its board would convene “very shortly” to discuss Nissan’s revelations.
French President Emmanuel Macron said the government, which owns 15% of Renault, was watching closely.
“The state, as a [Renault] shareholder, will be extremely vigilant regarding the stability of the alliance and the group,” Macron said during a visit to Belgium.
issan’s announcement came after the close of trading in its stock in Tokyo. But its shares plummeted 10% on the Frankfurt stock exchange.
“Nissan deeply apologizes for causing great concern to our shareholders and stakeholders,” the company’s statement said. “We will continue our work to identify our governance and compliance issues, and to take appropriate measures.”
Patrick George of Jalopnik reported that Ghosn’s arrest is a shocking end to a powerful automotive executive’s career:
In some ways, you could argue, Ghosn was the most powerful at present. The French-Brazilian executive served as chairman of Nissan and its former CEO, chairman of Mitsubishi, and chairman and CEO of Renault.
Together they make up what is occasionally the biggest car company in the world, depending on how Volkswagen and Toyota are doing that month. And it’s unlikely that that alliance—which at various times has saved each car company from crisis or outright extinction—would have happened without Ghosn at the helm.
Naturally, serving in these various roles for more than 20 years made him very wealthy, many times over. So to see it all collapse on allegations that he conspired to underreport his income and used company assets for personal benefit comes as such a surprise.
And while the conglomerate he helped build will surely survive without him, it will face great upheaval in the process.