A political row involving two of the world’s biggest carmakers is coming to a head with Nissan pushing for written guarantees from the French government that it will not interfere in its alliance with Renault, potentially putting UK jobs at risk.
The partnership has been thrown into crisis after the French government, led by the economy minister and former Rothschild banker Emmanuel Macron, increased its stake in Renault to 19.7% and introduced laws that double the power of long-term investors in the company.
His moves mean that Paris will control more than 30% of the voting rights in Renault from April, making it the biggest shareholder and giving it the power to direct the company’s strategy. Critics fear Macron is attempting a backdoor nationalisation of Renault and will use his powers to protect and generate jobs in France.
Renault owns 43.4% of Nissan after the carmakers formed an alliance in 1999, so the Japanese company is alarmed by this development. Carlos Ghosn is the chief executive of Renault and Nissan.
Nissan remains committed to the tie-up with Renault, which accounts for more than one in 10 cars sold worldwide, but is threatening to axe the agreement between the two companies if the French government does not back down.
The company is also looking for greater input in the running of Renault by converting its 15% shareholding into voting rights, according to sources familiar with Nissan’s plans. Nissan’s stake in the French carmaker currently carries no voting powers on key decisions.
Nissan employs more than 6,000 people at its plant in Sunderland, the biggest car factory in the UK, and insiders at the Japanese company fear the French government could use its influence to move production from the plant to France, threatening British jobs.
Nissan held a board meeting on Monday at which it discussed how to defuse the row. Negotiations have been going on for months with the French government and it is hoped the situation can be resolved by a Renault board meeting scheduled for next Friday.
It is understood that Nissan proposals include the French government reducing its stake, providing guarantees that it will not get involved in operational decisions, and that Nissan’s shareholding in Renault are given voting powers.
If the dispute is not resolved it could lead to a dramatic restructuring of the alliance because when it was initially agreed in 1999, Nissan was close to bankruptcy; it is now significantly bigger than Renault.
Other options available to Nissan include trying to buy more shares in Renault or to issue more shares to dilute the holding of the French carmaker. However, Nissan is thought to believe these options would be unfavourable to its existing shareholders and is therefore looking at other options.
Nissan declined to comment.
