Carlos Ghosn as CEO of Nissan and Renault: Can he Rework the 'Nissan Magic'?
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Code :LDS0007
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Region : Europe |
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Renault – The French Automaker Renaultwas a state owned government enterprise since 1945. Itwas started as amotorized vehicle assembler in 1898. Renault built trucks, airplane engines and heavy vehicles during theWorldWar II and after the war andwith the economic boom, Renault achieved high volume saleswith its low cost cars like 4CV, Renault 4 andRenault 5 through the 1970s and 1980s. During early 1980s, Renault expanded into US by acquiring half the shares of American Motor Corporation. However, the deal was unprofitable and the company had to withdraw from the market in 1987. A similar deal failed in Mexico, andwith both the deals financed through debts,Renaultwas leftwith huge debts accumulated by the end of 1980s. It reported losses of $3.5 billion between 1984 and 1986. Further, because itwas a state owned business, obligationswith labour unions led tomore costs for the company... Carlos Ghosn as CEO of Renault and Nissan By 2010, Nissan and Renault would build their cars using the common building blocks. Ghosn viewed the alliance as “managing contradiction between synergy and identity”17 and confirmed that while gaining synergies, the individual identity of each brand would be safeguarded. The othermajor alliances in the industry, the DaimlerChrysler and the GM/Fiat had not proved to be very successful because of impropermanagement ofmerged assets, trans-atlantic product development and failed attempt in understanding local market; Ghosn confirmed that Nissan’s alliance with Renault would creatively achieve it. At the same time the alliancewould avoidmerger andwouldmaintain ‘a spirit of partnership’18 . The alliance would be the fourth largest automobile group in theworld. InOctober 2004, the first carwas built using a common platformofNissan andRenault. Modus, a subcompactminivan ofRenault shared its basewithNissan’sMicra saving $500million forRenault every year... |
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