Renault-Nissan merger is not feasible, says Carlos Ghosn

Article by Christian Andrei, on February 15, 2011

Carlos Ghosn, Renault S.A.’s CEO, said that merging with alliance partner Nissan Motor Co. was still “not feasible” after unveiling three-year goals that did not meet previous targets.

During a conference call with analysts, Ghosn said that management integration with Renault’s 43 percent-owned Japanese affiliate is not part of the mid-term strategy because of internal opposition at both companies.

He added that such a move would backfire because of the companies' ingrained cultural differences and determination to remain independent.

Max Warburton, a London-based analyst with Sanford C. Bernstein, said that a Renault-Nissan merger would immediately lift the value of Renault's equity and Nissan's. He added that Ghosn's opposition to full integration “misses the point.”

Renault recently announced its first medium-term plan since the 2008 financial crisis, when Ghosn scrapped 2009 targets for a six percent operating margin and 3.33 million deliveries.

Ghosn pledged 3 million in annual sales by 2013 and a margin of more than five percent. [via autonews - sub. required]

Topics: renault, nissan

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