Sales of Nissan & Renault have Collapsed by nearly 8% since Ghosn arrest

When Renault invested over $5 billion in 1999 to bail out then-floundering Nissan, it was one of the more audacious moves in postwar automotive history.

One rival, scoffing at the idea, suggested the French automaker might better load a barge with gold and “sink it in the middle of the Atlantic Ocean.” Yet, the deal quickly confounded critics and, just three years ago, with Mitsubishi joining in, what had begun as the Renault-Nissan Alliance became one of the world’s three best-selling automotive groups, challenging established rivals such as Toyota and Volkswagen.

Now, however, the alliance is in shambles, with some analysts and company insiders even questioning the viability of the three automakers individually. To longtime observers, one man, Carlos Ghosn, was behind the unlikely success of the French-Japanese partnership — and that same man could be the cause of its unraveling.

The Brazilian-born executive, appointed by Renault to oversee its investment, “Was able to do things the Japanese culture wouldn’t have allowed, like closing plants and cutting the Nissan workforce,” said David Cole, director-emeritus of the Center for Automotive Research. “It saved Nissan, but (the company) hated him for it.”

The payback, Ghosn claims, came when he was arrested on Nov. 19, 2018, after his corporate jet landed in Tokyo. Facing an assortment of corruption allegations, Ghosn was locked up for most of the following four months in a tiny, unheated Tokyo cell, eventually released under bail and close scrutiny. In an audacious move, the 66-year-old executive escaped Japan last month, fleeing to Lebanon, where his parents were born and he has residency.

However Ghosn’s personal saga plays out, industry watchers see no chance he’ll return to the Renault-Nissan-Mitsubishi Alliance, leaving those who succeeded him struggling to figure out how to put things back together.

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