Wednesday , February 24 2021

Nissan's crisis deepens as "bankruptcies" for the Ghosn case

Ghosn was once the favorite of corporate and even popular Japan – even with an inspirational magic comic book – and there has been the glue that keeps the car since 1999.

FILE: Chairman, Chairman and Chief Executive Officer of Nissan Motor Co., Ltd., Carlos Ghosn. Image: AFP

TOKYO – The crisis in Nissan accelerated on Wednesday as it turned out that the giant of Japanese cars could face charges of alleged financial misconduct that led to the astonishing arrest of President Carlos Ghosn.

The capture on Monday for the millionaire motorway, which is credited with the transformation of the Nissan-Renault-Mitsubishi Motors alliance, has struck blows through the global automotive sector and corporate Japan.

The Asahi Shimbun said on Wednesday that Tokyo prosecutors believe Nissan also has the opportunity to respond to the undermining of the Ghosn package by about five billion yen ($ 44.5 million) over a four-year period. Both Nissan and the authorities refused to comment on the report.

Nissan's board will decide on Thursday whether it will remove the chairman of the 64-year-old tycoon, a stunning overthrow of fortune for the Brazilian entrepreneur credited with the creation of a three-dimensional alliance that sells more cars globally than any other carmaker.

The fate of Guo seems to be sealed, as his worst replacement as Chief Executive Officer, Hiroto Siacawa, launched a stunning platform to his adviser, saying that "too much power had been given" in his hands and mourning the "dark side of the time of Goose ".

He declined to offer the deep "bow of apology" that usually accompanies corporate scandals in Japan and lost the role that Guo had played personally by reviving the fortunes of the business.

However, in France, Renault said it was hanging with the fallen manager as chief executive, although he was named chief executive Thierry Bollore as deputy chief executive, giving him "the same powers" as Ghosn's "temporarily incompetent".

After an emergency board meeting, Renault called on its brother-in-law Nissan to share "seemingly gathered data" against Ghosn from a monthly internal investigation, saying it could not comment on the charges without this information.

Paris and Tokyo are trying to limit the fall from the arrest, with the finance ministers of the two countries claiming strong support for "one of the biggest symbols of the Franco-Japanese industrial co-operation".

The scandal – the last one in a string to affect Japan Inc. – wiped out millions of shares in the three companies, but Nissan returned to the Tokyo trading gap by more than half a percentage point in a declining market.


Ghosn was once the favorite of corporate and even popular Japan – even with an inspirational magic comic book – and there has been the glue that keeps the car since 1999.

"Ghosn is probably the country's most successful president in Japan," said Kosuke Sato, senior economist at the Japanese Institute of Research.

"What he did was unprecedented in Japanese corporate history."

He had a reputation as a laborer and won the nickname "Le Cost Cutter" in France for his smooth and hot approach to corporate restructuring.

Under his command, Nissan and Renault became deeply connected.

Renault owns 43 percent of Nissan while the Japanese company in turn holds a 15 percent stake in Renault.

However, Nissan has become the main player of the alliance, however, recording sales of 12 trillion yen ($ 106 billion) last year, compared to € 59 billion.

According to Financial TimesGhosn worked on the merger of the two carmakers opposed by Nissan because he was afraid that the Japanese company could be relegated to a minor role.

Jeff Kingston, director of Asian studies at Temple University Japan, told AFP that Goshen was "the victim of his own anger and success."

"He has trampled the Japanese cultural standards in the fanciful ways in which he organized his glory and his enormous compensation encouraged jealousy and called for retaliation," he told AFP.

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Local media reported that Nissan spokesman Greg Kelly, who was arrested along with Ghosn, ordered other executives to "hide wages."

Some damages due to other executives end up arriving at Ghosn, although it is unclear how the program works.

NHK, a public broadcaster, said that Nissan had paid "huge sums" to offer Ghosn luxury homes in Rio de Janeiro, Beirut, Paris and Amsterdam "without legitimate business reason".

Even when his fame was high, he attracted criticism for a fancy lifestyle, unlike traditional Japanese corporate culture and his salary – a total of 13 million euros last year.

Media reports also spoke of a luxurious Marie Antoinette party in 2016 for Ghosn's second marriage in the majestic Versailles Palace.

The Yomiuri Shimbun on Tuesday, reported that Nissan executives hit Ghosn as "greedy".

"It says the right things, but in the end it's all the money," the daily executive said.

His capture has also triggered alarms between Renault's French workers about what's ahead.

"What worries us is the alliance with Nissan," said Ghislaine, a production line manager at the Flins plant outside Paris – where Nissan's popular hatchback represents half of its production.

"I hope our future is not in jeopardy."

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