Nissan board fires Ghosn as chairman following arrest

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In this May 11, 2012, file photo, President and Chief Executive Officer of Nissan Motor Co., Carlos Ghosn speaks during a press conference in Yokohama, near Tokyo. (AP Photo/Koji Sasahara)
In this May 11, 2012, file photo, President and Chief Executive Officer of Nissan Motor Co., Carlos Ghosn speaks during a press conference in Yokohama, near Tokyo. (AP Photo/Koji Sasahara)

Tokyo (AP) — Nissan Motor Co. fired Carlos Ghosn as chairman last week, curtailing the powerful executive’s nearly two-decade reign at the Japanese automaker after his arrest for alleged financial improprieties.

The company’s board of directors voted unanimously to dismiss Ghosn as chairman and as a representative director, Nissan said in a statement. It said its own internal investigation, prompted by a whistleblower, found serious misconduct including under-reporting of his income and misuse of company assets.

It was a stunning downfall for one of the biggest figures in the auto industry. Ghosn had helped drive turnarounds at both France’s Renault SA and at Nissan and then managed an alliance between them that sold 10.6 million cars last year, besting its rivals.

Renault is still reeling from Ghosn’s arrest, and its share price has yet to recover. In a video released by Renault, its acting chief, Deputy CEO Thierry Bollore said the carmaker still plans to release several new models next year. Acknowledging the “particular situation” the company is in, he pledged his “full commitment” to Renault’s 180,000 workers and its partners and customers. Renault’s board decided not to fire Ghosn, instead installing temporary leadership.

Nissan said in a statement filed to the Tokyo Stock Exchange that its investigation uncovered misuse of company investment funds and expense money for personal gain.

The Wall Street Journal, citing an anonymous source close to Nissan’s investigation, reported that Ghosn used company funds to buy personal residences and enrich his sister.

Ghosn, 64, is suspected of under-reporting $44.6 million in income from 2011 to 2015, according to Tokyo prosecutors.

A French citizen born in Brazil, Ghosn became something of a corporate superstar in Japan as he led Nissan’s revival from near bankruptcy after Renault sent him to help in 1999.

Ghosn served as Nissan’s chief executive from 2001 until last year. He became chief executive of Renault in 2005, leading the two automakers simultaneously. In 2016, he also became chairman of Mitsubishi Motors Corp. after Nissan took it into the alliance.

Analysts say the future of Nissan’s alliance with Renault may be at stake, though Nissan said the company’s leadership was determined to minimize the impact from Ghosn’s case on the partnership. Renault owns 43 percent of Nissan, and Nissan owns 15 percent of Renault. The partnership remains crucial for both companies, since apart from financial ties the companies share technology and parts. Analysts say such sharing has been growing in importance as companies develop electric vehicles, net connectivity and artificial intelligence for autos.

29/03/2019