France to remove Ghosn as ‘CEO Renault’ after his arrest

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According to the French Finance Minister, Carlos Ghosn will not remain the CEO of Renault following his arrest in Japan over acts of financial misconduct.

The French state owns 15% stakes in Renault and finds themselves in no position to retain Carlos Ghosn as the leader of carmaker Renault. A meeting is soon to be held among the executive board members of Renault to temporarily replace Ghosn as Chief Executive Officer. It is expected that the Chief Operating Officer, Thierry Bollore who is already holding the charge of day-to-day activities of the company, will be asked to step up in place of Ghosn. The company understands the need of interim management structure as soon as possible to ensure the smooth workflow.

Carlos Ghosn, who was arrested after under-reporting his income to the Japanese prosecutors. It was also reported by the Japanese broadcaster NHK that the company had spent millions on Ghosn to provide him with luxury homes. The personal use of company assets and various acts of misconduct got him arrested on Tuesday. Ghosn at the age of 64 is also the chairman of Nissan and Mitsubishi during which he formed an alliance of the three auto giants to compete against Toyota and Volkswagen. However, Nissan and Mitsubishi are also set to bring him down from his executive post. This announcement has no doubt brought a wave of shock in the automobile industry as Ghosn is considered as a titan who turned around the fate of Nissan in early 2000. The shares in all three of the automakers fell dramatically after the news made its way to the public. Ghosn is accused of filing fake statements against his security reports and this violation could result in up to 10 years sentence in Jail and a fine of 10 million Yen. According to the Japanese law, all the firms are required to disclose the salaries of their executives who are employed for more than 100 million Yen. Ghosn was provided with houses in Brazil, Lebanon, Netherlands, and France without legitimate business justifications provided by Nissan. There were also millions of dollars spent on all four of them for renovation purposes without disclosing the financial statements accordingly.

Read More: Nissan to dismiss Carlos Ghosn due to ‘significant acts of misconduct’

With Ghosn arrested in Japan, the future of the car alliance remains unclear. Ghosn holds credit for turning around the fate of Nissan and Renault that later became a part of the alliance. The alliance formed by Nissan, Renault and Mitsubishi sold 10.6 million vehicles around the world in 2017. 1 out of every 9 vehicles sold around the world was dominated by the alliance that made it the top automotive group worldwide. CEO Nissan, Hiroto Saikawa is hopeful that the partnership will not be affected by this particular event.
Let’s see who replaces the top post in all three automakers. Stay tuned to Pakwheels for more updates.

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