World Lebanese Cultural Union
And he makes his case forcefully. This week at the Paris Motor Show, he explained why he thinks the partnership he created between Nissan Motor Co. and Renault SA has succeeded. Speaking to a group of analysts, reporters and other industry observers, he chopped the air, his hands shoving aside whatever was off the point and then sweeping together when he hit the crux of his argument.
“We don’t have a book about the vision. We don’t have statements,” Ghosn said. “We have three solid basic principles that everybody knows: respect for the identity of each partner, respect for the ability of each partner and the development of synergies only for the sake of performance for each company. What is revolutionary is that every single action in both Renault and Nissan at the level of the alliance is scrutinized under this.”
As chief executive of Nissan and Renault, Ghosn is a man of big ideas, with an engaging manner and a proven record on his alliance. But none of that may be enough to win him his biggest prize yet: a major linkup with the No. 1 automaker in the world, General Motors Corp. In his quest for an alliance, Ghosn has run up against a corporate culture that has no problem protecting itself.
GM executives said privately this week that they aren’t interested in an alliance. They don’t see much in it for GM, and they say they don’t need the distraction as they lay the groundwork for a turnaround at GM’s North American operations.
But GM’s management could face intense pressure from some members of the board to accept an alliance. Turning up the heat on GM Chairman G. Richard Wagoner Jr., billionaire investor Kirk Kerkorian said Thursday that he wants to buy another 12 million shares of GM, increasing his holdings to 12 percent from 9.9 percent. Kerkorian is GM’s largest shareholder.
Ghosn has said he was approached last year by Jerome B. York, a GM board member and Kerkorian associate, to discuss an alliance, though some GM officials say privately that they think Ghosn made the first move. Some observers see a plot by York and Kerkorian to set off a chain of events that would somehow put Ghosn at the helm of GM, replacing Wagoner.
One industry observer, who spoke on condition of anonymity because the talks are ongoing, said putting Ghosn into the picture sideswiped GM management, as it was deep into its restructuring effort.
“Bringing in a guy like Ghosn into your house, it gets you out of your comfort zone a guy who finds out what quickly needs to be done and does it. That’s what Kerkorian wanted,” he said.
Laying out some hope for a linkup, Wagoner on Wednesday said, “If [an alliance] can pick up the pace of our turnaround or generate stockholder value, we are wide open to that.”
Some industry observers view Ghosn as an overly ambitious executive who is out to construct an automotive superpower that would trump Toyota Motor Corp., Nissan’s arch rival. His powerful personality contrasts sharply with that of the lower-key Wagoner.
Although the proposal does pose a challenge to Wagoner’s leadership, the GM chief executive has shown over the years that he is a survivor. Wagoner, whose roots are in Richmond, sometimes flashes a plain-spokenness. For the most part, however, he tends to be guarded, even cryptic. He is thought by analysts to be an effective leader who knows how to rally the troops inside GM when necessary.
Still, Ghosn believes industry trends favor his approach. He said the global auto business is in trouble because of rising costs and stiff competition that keeps a lid on prices. He predicted a future of consolidation.
“You know that something is going to happen. We don’t know what it is, but we have to get ready for it to happen,” Ghosn said.
Among Ghosn’s fans at the motor show was D.C. Mayor Anthony A. Williams, who recognized the executive’s ability to articulate and act on his vision. “A great leader combines an ability to envision and to abstract and at the same time have an ability to implement on another level,” Williams said.
Renault began its search for a partner in the late 1990s, after the 1998 merger of DaimlerBenz AG and Chrysler Corp. The German-American merger forced other automakers to consider whether they could survive on their own as smaller companies. At the time, Nissan was in need of help, and Renault ultimately came to the rescue. But it was the last company Nissan called on. “We were the zebra,” Ghosn said. “The dark horse. The black sheep.” But Renault ultimately won the role of rescuer.
Ghosn said that managing Renault and Nissan has depended on a respect of cultural differences. The rule was put to a test after the partnership was formed when Ghosn was dispatched from Renault to lift Japan’s proud Nissan from bankruptcy protection.
The two companies have picked English as a common language. Ghosn and his other managers said they learned that imposing changes in search of synergy was ineffective. They sought synergy from the ground up, allowing junior managers access to the others’ processes.
Nissan and Renault shaved billions of dollars in costs by sharing engine technology. Nissan has opened its factories to Renault to teach the French Japan’s superior manufacturing system. And Renault has opened its books to teach its counterparts how to manage the cost of supplies.
