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Renault-Nissan spins its wheels while Carlos Ghosn sits in jail
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Soul-searching is in order for Nissan’s board after Ghosn allegations, governance experts say
Takashi Aoyama | Getty Images News | Getty Images
A general view of Nissan Crossing showroom in the Ginza district on November 21, 2018 in Tokyo, Japan.
Turmoil at Japan's Nissan Motor surrounding allegations of impropriety by ousted chairman Carlos Ghosn raises questions about the oversight role of the company's board of directors, corporate governance experts said this week.
Ghosn, long seen as a superstar of the global auto industry, was arrested last month after allegedly under reporting compensation and misusing assets.
He gained renown for reviving Nissan after French automaker Renault took a large stake in the company nearly two decades ago. He later went on to oversee an alliance involving Renault, Nissan and Mitsubishi Motors.
But Ghosn was dumped by the boards of Nissan and Mitsubishi after his arrest on Nov. 19, though is still chairman and CEO of Renault. He remains in custody in Tokyo and has yet to be charged.
Japanese broadcaster NHK, citing unnamed sources, reported last month that Ghosn has denied under reporting his earnings.
Jamie Allen, secretary general of the Asian Corporate Governance Association, said that a key concern about the allegations against Ghosn is why Nissan's board of directors was seemingly unaware.
“I think there is a clear issue of internal controls in that company that they're not properly addressing,” Allen told reporters in Hong Kong on Wednesday.
“If the board really didn't know about that, and maybe they really didn't know about that, then that doesn't speak … very highly of their internal controls, or their governance,” Allen said. “My point is boards have collective responsibility … so I think the board at Nissan really needs to do some soul-searching.”
Other experts also questioned the role of oversight at Nissan.
“I think it is extremely unlikely that the board did not know about this,” Jesper Koll, head of Japan at WisdomTree Investments, told CNBC on Friday.
“Because the reality is any board, whether it is a purely local Japanese company or whether it is an international, global company, whatever corporation you run, the executive compensation and CEO compensation is an extremely important issue,” Koll said.
John Buchanan, an expert in Japanese corporate governance at the Centre for Business Research at Cambridge Judge Business School, said that a lack of formal charges against Ghosn makes it difficult to assess the board's role, though he added it was unlikely to have been completely in the dark regarding remuneration.
And Nissan's decision to “disgrace the company by calling in public prosecutors” resulted in “effectively advertising the inadequacy of the board and Nissan's internal controls,” Buchanan said in an email.
“This can be seen as a demonstration that Japanese corporate governance is still largely internally focused,” he said.
'Foreign majority shareholders'
Contacted by CNBC for comment, Nick Maxfield, a spokesman for Nissan, which is headquartered in Yokohama, Japan, said by email that the company went to Japanese prosecutors with results of an internal probe spurred by a whistleblower that had “uncovered substantial evidence” of alleged under reporting of compensation and misuse of assets and funds.
Maxfield, who said Nissan could not disclose specifics of the probe, referred to comments made by Nissan CEO Hiroto Saikawa at a press conference the day Ghosn was arrested.
Saikawa had said Nissan would need to “identify the issues of governance (and) really look back on what happened seriously and take immediate and fundamental countermeasures” because the alleged misconduct had been lengthy.
Maxfield also said that Nissan's board on Nov. 22 vowed to create a special committee to receive advice from an independent third party on governance and managing compensation.
A team of Jefferies analysts suggested in a report last month that foreign shareholders — who, by their calculation, hold more than 80 percent of Nissan's stock — also cannot shirk responsibility.
“If Nissan was badly governed, then the blame should rest squarely on the shoulders of its foreign majority shareholders,” the report said.
Renault has the largest single stake in Nissan at more than 40 percent.
The European automaker did not immediately respond to a request by email for comment from CNBC.
Some experts also cautioned against reading too much into Nissan's problems and losing sight of positive changes that have taken place in broader Japanese corporate governance in recent years, such as greater power for whistle-blowers — a key element of the Nissan case — and a new ombudsman clause.
“That actually shows, I think, that corporate governance in terms of the structure that is being put into place is actually looking to improve,” WisdomTree's Koll said.
Ulrike Schaede, professor of Japanese Business at the University of California San Diego, agreed that the overall situation has improved, but stressed that corporate abuses will occur even with the best of safeguards.
“If a CEO wants to do something that benefits him or her more than the company, they will be able to do it no matter what the governance system does,” Schaede said.
“It happens in all systems,” she added. “So in that sense I don't think that this is indicative of a system failure in Japan.”
EBRD lends €15 million to Turkish chemicals maker to increase production of a key component in energy-efficient tyres
EBRD lends €15 million to Turkish chemicals maker to increase production of a key component in energy-efficient tyres
EBRD €15 million loan will fund building of new production facility
New plant will increase capacity by 40,000 tonnes by 2020
Expansion supports fast-growing demand for silica used in energy-efficient tyres
LONDON, 08-Nov-2018 — /EuropaWire/ — In support of greener business practices, the EBRD is lending €15 million to Turkish chemicals maker Egesil Kimya Sanayi ve Ticaret A.S. to increase production of precipitated silica, a key component of energy-efficient tyres that reduce carbon emissions. Founded in 2002, Egesil is majority-owned by Germany’s Evonik Industries, one of the world’s leading specialty chemicals producers and the world’s largest silica producer.
The loan will help build a new production facility in Sakarya, Turkey, next to the company’s existing facility. It will increase the speciality chemicals manufacturer’s annual production capacity of precipitated silica by 40,000 tonnes.
Demand for highly dispersible silica is strong and growing in the global tyre industry to replace carbon black, the traditional filler material in tyre manufacturing. Silica increases the grip and adhesion of tyres and has better anti-skid properties. It also reduces fuel consumption by lowering rolling resistance.
The new facility is expected to become operational by 2020. It will help make carbon emissions savings of around 67,000 tonnes of CO2 equivalent per year during the life cycle of tyres. The EBRD Strategy for Turkey emphasises contributing to the improvement of energy and resource efficiency and to the further integration of medium-sized private Turkish companies into global value chains. The project is also part of the EBRD’s Green Economy Transition (GET) approach, as 100 per cent of the Bank’s loan will be used for green investments.
Egesil Kimya has been chosen among various Evonik subsidiaries to house the capacity increase targeted to supply the European automotive tyre industry. The company’s existing facility has a very good track record, a cost-competitive manufacturing base and was awarded the Evonik Platinum Safety Award in 2018 for not having had a single work accident over the past 15 years. Strong demand for its product and full order books triggered the need to expand capacity.
As the leading silica producer in Turkey, Egesil Kimya aims to reinforce its leading position in the country and meet increased demand both locally and in export markets. With the additional facility, Egesil Kimya will become one of the largest silica plants in the world. The company’s main customers are the world’s leading tyre manufacturers.
The EBRD has invested almost €11 billion in close to 280 projects in Turkey, with a focus on investment in sustainable energy, improving infrastructure, strengthening the competitiveness of the private sector, deepening capital and local currency markets, and promoting regional and youth inclusion and gender equality.
For all media enquiries, email press@ebrd.com
SOURCE: EBRD
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Volkswagen selects WPP as its lead creative partner in North America
LONDON, 28-Nov-2018 — /EuropaWire/ — Volkswagen has named WPP as its lead creative partner in North America following a competitive review.
Responding to VW’s emphasis on expertise in technology alongside outstanding creativity, WPP put forward a cross-company and multi-disciplinary team comprising Possible, David, Taxi, Geometry Global and Hogarth, which will draw on additional resources from other WPP agencies as required.
As VW’s “Powerhouse” agency for North America, WPP will handle Digital, Creative, Dealer and Production throughout the United States and Canada, with additional responsibility for Mexico.
Mark Read, CEO of WPP, said: “We are delighted and proud to have been appointed as Volkswagen’s lead creative partner in North America. WPP now offers a powerful combination of creativity, commerce, data and technology services that is increasingly resonating with clients. Volkswagen is one of the world’s iconic brands and we are very excited to have been given the opportunity to help reshape the company’s marketing and support its transformation.”
Further information
Kevin McCormack, WPP
+1 212 632 2239
kevin.mccormack@wpp.com
Niken Wresniwiro, WPP
+44 (0)20 7408 2204
niken.wresniwiro@wpp.com
About WPP
WPP is the world leader in communications services. The company provides a comprehensive range of services including digital, ecommerce and shopper marketing; advertising and media investment management; data investment management; public relations and public affairs; brand consulting; health and wellness communications; and specialist communications. For more information, visit www.wpp.com.
SOURCE: WPP plc.
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Jaguar Land Rover’s venture capital fund made seed investment in WeTrip
Jaguar Land Rover’s venture capital fund made seed investment in WeTrip
InMotion Ventures, Jaguar Land Rover’s venture capital fund, today announces seed investment in WeTrip, the digital platform making group holiday planning and booking simpler.
Jaguar Land Rover’s venture capital fund invests in group travel experience platform WeTrip
InMotion Ventures backs WeTrip to accelerate product development and support ambitious global growth plans
COVENTRY, 29-Nov-2018 — /EuropaWire/ — InMotion Ventures, Jaguar Land Rover’s venture capital fund, today announces seed investment in WeTrip, the digital platform making group holiday planning and booking simpler.
InMotion’s seed stage funding will support WeTrip in its global ambition to become the go-to digital platform for booking personalised group experience holidays. In August 2017, the company raised $1m funding to launch WeSki, a platform that allows groups to share responsibility for booking complete, tailor-made ski holidays.
As well as investing in the future of mobility, our fund seeks to back companies that are enabling adventure through powerful digital lifestyle brands. WeTrip is rapidly building a community of adventurous travellers, using their powerful tool for group bookings, and we believe there is a genuine unmet need for a product of this kind. SEBASTIAN PECK, MANAGING DIRECTOR
Our unique platform offers travellers greater flexibility, better value and a simpler way to book group holidays, centred around a shared adventure, to bring the fun back to the booking experience. We are thrilled to have the backing of InMotion to accelerate our product development and support our ambitious global growth plans. YOTAM IDAN, CHIEF EXECUTIVE
FURTHER INFORMATION
About InMotion
At InMotion, we are investing in the future of transport, mobility and travel. Powered by Jaguar Land Rover, we are supporting entrepreneurs and innovators who change the way we move.
InMotion Ventures is Jaguar Land Rover’s venture capital fund. We invest in early-stage technology companies that change the face of urban mobility, support an active outdoor lifestyle and deliver unique travel experiences. We are based in London and invest globally.
InMotion’s mobility services arm Studio 107 works closely with our parent company Jaguar Land Rover to build new services in the urban mobility sector. The name Studio 107 is a nod to the 107% rule in motorsport. In qualifying, drivers who fail to set a lap within 107% of the fastest qualifying time are not allowed to start. Our goal is to select the ideas that play to our strengths and develop them into winning businesses.
To find out more about InMotion, please see: https://www.inmotionventures.com
NOTES TO EDITORS
About WeTrip
WeTrip is a fully dynamic booking website designed specifically for millennial group travelers who seek unforgettable, great value experiences. WeTrip partners with multiple travel operators to offer greater choice, more flexibility and a simpler booking experience.
The ability of the organiser to share the group package with friends – who can then tweak and pay independently for their own requirements online – is one of the key features that makes this company unique.
WeSki, the 1st product, is a trailblazer in the category that is putting the fun back into booking ski holidays.
For further information, contact:
Sally Clift
Corporate Communications
Mobile: +44 (0)7384 430009
Email: sclift2@jaguarlandrover.com
SOURCE: InMotion Ventures
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BATTERY SWAP
Pubblicato il 10 December 2018 Picchio has developed a battery swap station that takes about 2 minutes to replace the battery, which is even lower than a normal refueling.The station does not use significant electrical power, it can be connected to photovoltaic systems and it can constitute an accumulation point for bidirectional energy exchanges for… Continue reading BATTERY SWAP
Fiat Chrysler to build Jeep in revived Detroit plant
Fiat Chrysler to build Jeep in revived Detroit plantDetroit — Fiat Chrysler Automobiles NV plans to convert an idled engine plant in the city into an assembly plant as part of the automaker's plans to add a new three-row Jeep SUV to its lineup, The Detroit News has learned.
The Auburn Hills-based automaker plans to revive Mack Avenue Engine II, which has been idled since 2012, as an assembly plant building a new three-row Jeep Grand Cherokee for model year 2021, multiple sources familiar with the plans told The News. The move could add as many as 400 new auto jobs in the city.
The renovated Mack Avenue facility would be the first new auto assembly line to open in Detroit in 27 years, potentially cushioning the blow of General Motors Co.'s plans to stop production of four sedans at its Detroit-Hamtramck assembly plant by June 1. FCA's plans are the latest move by automakers in the waning days of the year before Detroit's automakers begin to renegotiate their contracts next year with the United Auto Workers.
Foreign and domestic automakers are under increasing pressure from President Donald Trump to boost production of cars, trucks and SUVs in the United States — even as his administration wages a costly trade war with China, Canada, Mexico and the European Union that is raising steel prices and threatening tariffs on imported vehicles.
FCA's plans for its Detroit plants come as GM CEO Mary Barra was on Capitol Hill for a second straight day to caucus with Michigan's congressional delegation and Ohio's two senators. They want the automaker to reconsider its plans to idle four U.S. plants next year, a request that Barra appears to have politely rebuffed.
When Mack II starts production of the three-row Grand Cherokee, FCA would begin retooling Jefferson North Assembly Plant — directly across the street from the Mack Avenue Engine Complex — to make way for the next generation of the two- and three-row Grand Cherokee. A public announcement is tentatively scheduled for the end of next week.
An FCA spokeswoman and the office of Mayor Mike Duggan declined comment.
“FCA is essentially out of capacity,” said Jeff Schuster, an analyst with LMC Automotive in Troy. “They’re kind of running up against being against full capacity. This is a very different situation than what GM is dealing with.”
Even as Fiat Chrysler officials mull decisions to prepare for a future expected to include expensive electric and autonomous vehicles, the automaker needs to invest in a new assembly line to build the profitable SUVs that will raise cash to fund that future. Fiat Chrysler’s plant capacity utilization in November hit 92 percent in North America.
The capacity crunch is not an accident. In 2016, FCA's late CEO, Sergio Marchionne, shocked the industry when he confirmed FCA would abandon car production in the United States and retool the plants to build profit-rich Ram pickups and Jeep SUVs. The plans to convert Mack II to build the Grand Cherokee are the latest move in that strategic realignment.
FCA also recently approved plans to spend six months next year retooling its Warren Truck Assembly Plant to prepare for production of a 2021 full-size three-row SUV, the Jeep Wagoneer. The automaker likely has delayed plans to repatriate from Mexico production of the Ram Heavy Duty.
Construction on Mack II, internally dubbed “Plant X,” likely would begin next year, as Detroit's automakers prepare to begin national contract talks with the UAW. To convert the old engine plant to a full assembly line, sources said, the automaker would need to add at least a body and paint shop.
Reviving the idled half of the Mack engine plant as an assembly operation would improve a worsening capacity problem for Fiat Chrysler. With strong demand for its Jeep and Ram products, the automaker has shuffled products from plant to plant in recent years while it retools for new vehicles — an attempt to avoid the significant financial hit of idling production of its most profitable vehicles.
Fiat Chrysler's North American assembly plants are currently running at 92 percent capacity, according to data compiled by LMC Automotive for The Detroit News. By comparison, GM and Ford Motor Co. were operating at 72 percent and 81 percent through November, respectively.
But FCA's Jefferson North plant, on the west side of Conner between Mack and Jefferson, is operating at 130 percent capacity. That means the automaker is running extra shifts to meet demand for the Jeep Grand Cherokees, Jeep Grand Cherokee SRTs and Dodge Durangos made there.
Only two of Fiat Chrysler's U.S. assembly plants are operating at below 80 percent capacity in 2018: the Toledo Supplier Park and Warren Truck Plant. Currently building only the Ram 1500 work truck, the Warren plant is operating at just 46 percent of capacity.
The new production line on Mack Avenue would also add a valuable new three-row product to Fiat Chrysler’s hot-selling Jeep lineup. The revamped line is expected to add hundreds of new jobs on Detroit’s east side and to bolster the city's tax base.
FCA's plans for its U.S. plants are a stark contrast to GM's. The Detroit automaker plans to idle five plants in North America next year, imperiling the jobs of 6,300 line workers in the region as it slashes some 8,000 white-collar jobs in a restructuring plan designed to save the Detroit automaker $6 billion by 2020.
Among the affected GM plants is Detroit-Hamtramck Assembly, staffed by nearly 1,350 union workers and one of only two vehicle assembly plants left in Detroit. Should GM's Detroit plant close as part of 2019 contract talks with the UAW, Fiat Chrysler’s Jefferson North Assembly Plant stood to become to final auto assembly plant in Detroit — until the Mack II project emerged.
Jefferson North, the last remaining automotive assembly plant located entirely inside Detroit's borders, completed construction in 1991 and produced its first Grand Cherokee in January 1992. GM opened Detroit-Hamtramck Assembly in 1985, after the city used eminent domain powers to seize a predominantly Polish neighborhood for the auto plant.
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ithibodeau@detroitnews.com
daniel.howes@detroitnews.com
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