Mitsubishi could take Renault stake in alliance reorganization

Renault-Nissan-Mitsubishi Renault Nissan Mitsubishi

Mitsubishi Corp could possibly invest in Renault as part of scenarios being thought to reinforce an alliance between Renault, Nissan and Mitsubishi Motors, two sources knowledgeable with the issue said.

French newspaper Les Echos reported previously on Thursday, mentioning an unnamed executive knowledgeable with the discussions and other unnamed sources, that Mitsubishi, a conglomerate with a 20% ownership in Mitsubishi, could take a 10% stake in Renault.

It stated this was one scenario of many under discussion, which could also consist restructuring strategies and fresh cost savings schemes.

Nothing was yet established and any decision might not be considered until May, when the alliance is due to existing fresh measures to reboot joint operations and deliver on expense cuts, one of the sources stated. Renault refused to comment.

Mitsubishi counts Japan’s Nissan as its biggest shareholder, though ties run deeper between the other two automakers of the alliance. Nissan holds 15% of Renault, while the French automaker in turn has 43% of Nissan.

Relations between Renault and Nissan changed for the worse after the arrest in Japan of former alliance leader Carlos Ghosn in 2018. He has since fled to Lebanon, from where he has stepped up his defense against allegations of financial misconduct. He rejects any wrongdoing.

The automakers have since cleared the decks of many managers connected to the Ghosn era, but momentum for joint projects ground to stop.

They have both pledged to try and re-energize the alliance, as automakers face declining demand in emerging markets and costly programs to construct new models, including in less polluting cars.

The coronavirus crisis has compounded issues for the sector as production grinds to a halt.

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