It has been a torrid 12 months for Carlos Ghosn, the man who runs not one, but two car firms: Renault in France and Nissan in Japan.First GM was not impressed with his negiotating skills and rejected his proposal for an alliance.
Then in February Nissan issued a profit warning—its first real reverse since 1999, when it forged its alliance with Renault, which bought a 37% stake (later raised to 44%) in the much bigger but nearly bankrupt Japanese firm. Describing the setback in deliberately vivid terms as a “performance crisis” that needed to be fixed as soon as possible, Mr Ghosn also had to admit that his sales target of 4.2m vehicles in 2009 would be missed. Then at a testy shareholders' meeting in June, Mr Ghosn revealed that Nissan's profits would fall further in the first quarter, because of slow sales in North America. Renault's ageing product range, meanwhile, has led to falling sales and market share in Europe.
So is it time to write off Mr Ghosn as a gifted turnaround artist who began to believe his own publicity and over-reached himself when he took on the running of Renault as well as Nissan in 2005? And is the much-touted alliance between the two companies really superior, as he claims, to the car industry's usual approach of mergers, which often go wrong and destroy value?
At Nissan, forecasting errors gave managers too little time to react to shifts in demand, particularly in North America. The firm's product line-up was also unbalanced, with a deluge of new models launched within a few months, which made marketing difficult. Mr Ghosn also concedes that Nissan's senior managers may have found it hard to adjust to sharing their hyperactive chief executive with Renault, and taking on new responsibilities in his absence. “It was not as if I was a particularly relaxed or laid-back CEO,” he smiles. Mr Ghosn's appointment to the top job at Renault, in addition to running Nissan, may also have contributed to its problems.
Whether Mr Ghosn can restore his somewhat tarnished reputation will become clear in the next two years.His “stakeholders” want him to get Renault-Nissan firing on all cylinders first. Much will depend on his ability to rekindle the sense of urgency that helped bring Nissan back from the brink eight years ago. In today's less dramatic circumstances, it will not be easy.
