What The Heck Is Going On Between Nissan And Renault?

Industry News

Is this relationship deteriorating?

It seemed like a done deal - Fiat Chrysler Automobiles was set to merge with the Renault-Nissan-Mitsubishi Alliance. Then Nissan expressed concern with the merger and may have even hurt FCA in the process. And now, unless the rumored "secret talks" to save the merger pan out, it looks like the FCA and Renault-Nissan Alliance partnership is completely dead.

Not only has Nissan damaged its relationship with FCA, however, but Automotive News now reports that its alliance with Renault is being called into question. It's so bad that Renault's new chairman, Jean-Dominique Senard, will have to explain to shareholders why the company's alliance with Nissan is still beneficial.

"Senard is in a tricky situation," Denis Branche of Paris-based Phitrust, a Renault shareholder who opposed the FCA merger, told Automotive News. "He made Renault's governance healthier, but there is still work to do. And the issue of the governance of the Renault-Nissan alliance remains." Adding to the mess Senard has on his plate is the fact the French government did not support the merger with FCA and that French President Emmanuel Macron may have reportedly been turned down Senard's requests to meet with him.

But tensions have been steadily growing between Nissan and Renault since before the FCA-Renault fiasco, especially after former Chairman Carlos Ghosn was arrested. It's so bad that Renault CEO Thierry Bollore, Ghosn's former second-in-command, and Nissan CEO Hiroto Saikawa are reportedly not on speaking terms.

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At this point, we have to step back and wonder why Nissan and Renault should stay allied. After adding Mitsubishi, the alliance became one of the largest automakers in the world. That's a good enough reason for some, but Nissan and Renault still have very different corporate structures and there isn't a lot of synergy in either automaker's product portfolio. Nissan's lineup is aging in the US, with some models now entering their 10th year (or more) on the market without a significant refresh.

It seems like Nissan could benefit from Renault's fresher lineup, which contains more modern designs and powertrains. We certainly wouldn't object to the Renault Megane coming to the US as the new Nissan Sentra. But as of now, we are struggling to see why the two companies need each other.

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