Renault-Nissan-Mitsubishi Alliance: putting an end to the myth of the Great Helmsman

Last week Carlos Ghosn told us a story about Nissan, Renault and the Alliance that ended tragically in 2019. Indeed, for him, if his own trajectory broke in November 2018, then it could not be any different from that of the companies he was managing and the destiny of this fragile Alliance that he was leading.

 

There's nothing surprising about that since that's the way he's wanted history to be written for years: just as Jean-Luc Mélenchon [leader of the radical left in France] said "the Republic is me", Carlos Ghosn went repeating "the Alliance is me" and suggesting that if he was no longer there then everything would fall apart.

 

As it is more difficult for analysts and journalists to take an interest in the life of organisations and the concrete issues dealt with by firms or the Alliance, the credibility of this tale has been greatly enhanced by their writings and convictions. Carlos Ghosn can therefore claim that, since his arrest, the capitalisation of both Renault and Nissan has collapsed. He has done his utmost to convince analysts and markets that most of the performance of the companies in the Alliance should be attributed to him. He has been so successful that they are indeed concerned about his departure. Fortunately for Renault, for Nissan and for the Alliance, past and present realities are a little more complex and if, in fact, the Alliance has indeed been in a state of distress in recent months, it is, to say the least, quick to wipe it off the map and to affirm that it is now nothing more than an "Alliance masquerade" doomed to imminent death.

 

First of all, if, as we have already been able to write like many others, the Senard-Bolloré duo was not particularly brilliant when it came to managing the crisis triggered by the arrest during the first half of last year, the difficulties were already there prior to it and, in a way, the arrest of Carlos Ghosn is a symptom. Beyond the problems that have been recurring for twenty years and which are associated with industrial and engineering cultures that are very difficult to converge, Nissan has, since the episode of double voting rights in 2015, nurtured doubts as to Carlos Ghosn's ability to continue to safeguard its interests. They began to lose faith in his "don't worry, I'll take care of everything". They were careful not to express these doubts. Carlos Ghosn did not have the intuition and the story went on.

 

In 2018, as he stated in his press conference, "he has been asked", at age 64, to continue to lead Renault and the Alliance. He was then given a curious mission statement that consisted in preparing for the "post-Ghosn era". He now pretends to have accepted it reluctantly, even though this was his manifest will and he achieved his goal by once again manipulating the argument that, without him, the Alliance might have had difficulty continuing and the famous convergences desired in the 2017 plan might not have taken place.

 

He nevertheless accepted a "roadmap" from Bruno Le Maire (France’s Minister of the Economy) which aimed at a stronger integration between Renault and Nissan.
A merger had been evoked a few months earlier by Bloomberg. Bercy had denied it. Carlos Ghosn had not dismissed it a priori while expressing his preference for a new "tailor-made" scheme. Without expressing it, obviously, the Nissan then did everything possible to ensure that this "mergerist" course was not taken. Nevertheless, convinced that he remained the undisputed boss, Carlos Ghosn maintained it. He then lacked judgement and suffered from his relative isolation. In hindsight, one can only say that entrusting Carlos Ghosn with the task of preparing a future without him was not the best idea Bercy had. Accepting this mission while being convinced that his extraordinary charisma would end up overcoming both Bercy's "mergerist" approach and Nissan's reticence, was, similarly, on the part of Carlos Ghosn, presumptuous to say the least.

 

Today, Carlos Ghosn is no longer head of the Alliance. The Alliance has suffered a lot from the paralysis in which many joint projects have found themselves and the two companies are not at their best. Nevertheless, since the autumn, with the changes at the head of Nissan and the changes that have taken place and will take place at Renault, the Alliance has been able to start up again on a basis that we can hope will be improved.

 

To found this renaissance, we can first of all count on the conviction not of the leaders but of a large part of the teams of the two companies who know they need each other and who, for many of them, have been able, willingly or unwillingly, to experience the Alliance in concrete terms and see its benefits. They know the difficulties and the limits and have only been able to note, in many cases, the impossibility of convergence. They have also seen all the cases where it works and are not prepared to give up what it has achieved. They have experienced the past year as one in which we risked losing those gains of 20 years. They are therefore reassured that the merger plans have been abandoned and that the Alliance is left to deal with them: since the difficulties arose when we wished to hasten the pace, it is not unreasonable to return to a slower tempo that is more respectful of the complexity of the issues to be dealt with together.

 

To drive this rebirth and keep the Alliance alive after Ghosn, the management teams will have to exercise a "right of inventory" which will first consist in asking why the 2017-2022 plans of the two companies had defined objectives that both will not achieve. Then it will not be enough to say, as Carlos Ghosn did at his press conference on Nissan, that it is because he was no longer there to lead. He insisted that it was not he who had "appointed" Hiroto Saikawa or Thierry Bolloré but that it was the responsibility of the Board of Directors. This is true, but the fact remains that he proposed their appointment and that he was the great inspiration behind the unrealistic plans on which they committed their teams and which they have so far pretended to be able to respect.

 

As Clotilde Delbos indicated, it will now be a matter of writing ambitious but tenable new plans. Similarly, for the Alliance, it will be a matter of setting reasonable convergence targets. To do this, it will be good to remember that autocracy has more vices than virtues: since only collectives make and will make Renault, Nissan and the Alliance live, we should take advantage of the Ghosn episode to break with the myth of the Great Helmsman and restore sustainable collective processes.

 

Large organizations cannot simply be reduced to their leaders, either by themselves or by observers, analysts or markets. The mistake made by Renault's reference shareholder in recent years has been to allow himself to be trapped in this mythology. We can only hope that he too learns the lessons of the past better than Carlos Ghosn seems prepared to do.

 

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