All Associated Press NewsTOKYO (AP) - Japan's Nissan and France's Renault have approved opening talks with the U.S. auto giant General Motors over a possible alliance, the Japanese and French automakers said.
Nissan Motor Co.'s board of directors met on Monday and decided the company "should proceed with exploratory discussions concerning a potential alliance with General Motors," Nissan said in a statement.
Later Monday, the Renault board approved opening talks with General Motors over a possible new alliance with Nissan Motor Co. -- if the U.S. company wants the discussions, Renault said in Paris.
"The Board of Directors approved the position proposed by Carlos Ghosn: Exploratory discussions with General Motors concerning a potential alliance could start if General Motors Corp. makes the proposal," the brief Renault statement said.
Ghosn is the CEO of both Renault and Nissan.
Local media reports have said Renault and Nissan could buy up to 20 percent of outstanding shares in GM. Details of the possible investment plan surfaced after billionaire investor and major GM shareholder Kerkorian proposed Friday that the troubled American carmaker join the Nissan-Renault alliance.
Ghosn has discussed the matter with Kerkorian and is willing to talk to GM, according to a separate statement by Nissan and Renault.
GM has been engaged in an extensive turnaround plan in North America amid declining profits, high labor costs and growing competition from Asian automakers. The automaker announced plans last year to close 12 plants by 2008 and said 35,000 hourly workers had agreed to retire early or accept a buyout offer.
If it materializes, the deal would create a huge auto alliance with annual output exceeding 15 million vehicles and commanding nearly one-quarter of the global market share, according to news reports.
A three-way alliance could also mean the departure of GM's chief executive, G. Richard Wagoner Jr., and leave Ghosn overseeing the three companies. Ghosn is hailed for pulling back Nissan from the brink of collapse in 1999 and turning it into one of the world's most profitable car makers.
The auto industry, however, is rife with ambitious mergers and alliances that have gone awry. Last year, GM had to pay US$2 billion to break an alliance forged in 2000 with Italy's Fiat SpA after the Italian automaker's finances and market share began to collapse.
In the 1990s, BMW AG lost billions after buying Britain's Rover. DaimlerChrysler AG even tried a three-way partnership of its own, bringing in Mitsubishi Motors Corp., but unraveled the tie-up last year.
Ghosn's initial thinking about a GM-Renault-Nissan partnership is centered on potential cost reductions, news reports said. He suspects the three companies together could reap substantial savings if they were to cooperate on engineering; share the basic underpinnings, or platforms, of vehicles; and consolidate their manufacturing operations, the reports said.
Nissan shares finished marginally higher Monday, adding 7 yen (US$0.06), or 0.56 percent, to 1,257 yen (US$10.99) on the Tokyo Stock Exchange.
Renault owns a 44.4 percent stake in Nissan, which in turn owns a 15 percent stake in Renault.
If they make Ghosn CEO for all three he could become the most powerful guy in the automotive industry. But at least GM will finally make cars that people will buy and it won't fall apart when you close the door after taking it home from the stealership.
I don't think that this is a merger since GM & Renault-Nissan isn't swapping stocks in the near future. As what have been said in the report it is just an alliance.
Currently, GM & Ford has an alliance of some sort with both parties sourcing out some parts from each other to save on development time & manufacturing costs.
As stated in the report they are looking possibly in joint platform development and the colocation of manufacturing plants. Similar to what the Ford Group is currently doing... the Tribute & Escape are near-identical twins; the Focus, Mazda3 & S40 share the same platform, the Fusion was derived from the Mazda6 and in turn the 2008 Mazda6 will be derived from the Fusion, Jaguar sources its powerplants from Ford, etc.
Na feature nato sa CNN last month. This guy ghosn turned nissan from the brink of collapse to profitability in less than 2 years. 1 year ahead of their expected target. Astig to si Ghosn 1 week sa europe siya then sa Japan naman!!
I don't think that this is a merger since GM & Renault-Nissan isn't swapping stocks in the near future. As what have been said in the report it is just an alliance.
Correcting myself.
Renault-Nissan is interested in buying GM stocks according to a GM shareholder.
Nissan, Renault and GM merging?
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