RENAULT, NISSAN TO MAKE PEACE WITH EACH OTHER
Renault and Nissan are swimming in red ink, with the COVID-19 pandemic exacerbating their woes and pushing both of them to end their acrimonious ties and hope to strengthen the alliance that Carlos Ghosn had built.
Writing for CNN Business on May 25, 2020, Charles Riley said the coronavirus pandemic may be forcing Renault and Nissan to rethink their strained relationship and hoping to make love lovelier the second time around. The carmakers have been partners since 1999, cooperating on strategy and product development while never taking the plunge and completing a full merger.
Together with junior partner Mitsubishi Motors, the unique industry alliance employs roughly 450,000 people and in 2018 it sold roughly one in every nine cars around the world. Yet the partnership began its third decade in turmoil. The 2018 arrest of former alliance boss Carlos Ghosn, a turnaround expert credited with keeping Renault and Nissan in business, sparked a series of leadership changes at both carmakers, confusion over their strategy and questions over whether the sputtering relationship had outlived its usefulness, Riley wrote.
Nissan is preparing to reduce its global production capacity by 20% and close a plant in Barcelona, according to Japan's Nikkei Asian Review. Japanese media reported that Nissan could slash its workforce by 20,000. Renault could also stop making two popular models in Spain and move that production to Nissan's massive plant in England, according to the Financial Times. Nissan, which reports financial results for fiscal year 2019 on Thursday, has endured four straight quarters of declining profits. Operating profit fell to 54.3 billion yen ($504 million) for the three months ended in December, plunging 83% from the same quarter a year before. #COVID19