“The work of mourning is long enough. Two months after the spectacular arrest of Carlos Ghosn in Tokyo, the staff of Renault is struggling to cash, blows a source close to power. Before acceptance, there is stupor, denial, anger, trembling and depression. Normal to go through it, “Mr. Ghosn” crushed everyone since his takeover at the headquarters of Boulogne-Billancourt. Back in chapter on fourteen years of reign at Renault.
The return of the prodigal son
When Carlos Ghosn arrives in Paris to take the wheel of Renault in the spring of 2005, the Polytechnique is haloed by its great success – the Nissan flash rescue. For the first time since the Liberation, the former Regie is left with a boss from his ranks and not with a parachute chosen by the French State, its historic shareholder. Seduced by his “vitality”, his “intensity” and his “intelligence”, Louis Schweitzer recruited him for this purpose, nine years earlier.
At Renault, the “cost killer” puts on a tailored suit: “president of the general management”. His predecessor, he retains the presidency of the board of directors. “Carlos Ghosn will have all the powers. In the automotive, the operational and the strategic are inseparable “, ensured on the moment the former” dircab “of Laurent Fabius. The power, Carlos Ghosn will not let go finally that these days, ejected from the throne following his indictment in Japan for financial malpractices and breach of trust. One of the biggest scandals of the century in the business world.
Fourteen years earlier, the hierarchs of the Diamond would obviously have never imagined such an outcome. At times suspicious, they had seen a fifty-one-year-old French-Lebanese-Brazilian leader arrive, a rock star in Japan. Did not he start his big press conferences with a countdown that started two hours before his arrival? They knew him from before, from his short and brilliant time at the Régie, between 1996 and 1999. As a deputy general manager, former Michelin was hired to put the accounts squarely.
His first reflex? Harden very hard a saving plan decided before hiring. With him, it will not be a reduction of 3,000 francs in the cost of manufacturing a car, but more than 8,000 francs. Neither one nor two, he decides in the heart and proposes to close three factories to Louis Schweitzer. The latter will only consent to sacrifice Vilvoorde in Belgium. Too much, already, for Jacques Chirac, who stings a big anger. Whatever. At Renault, the new guy has already left his mark.
All fire all flames
On his return with a flourish six years later, business is much better for Renault. “The outgoing management was quite proud of her,” recalls Patrick Pélata, the boss’s former right-hand man. The reality is not so rosy. Design and product directions are not talking to each other, no new models are planned for the 2006 vintage. Carlos Ghosn is immediately in motion and applies his refined methods along the Seine in the shadow of Mount Fuji – not without splashing . “Renault was not in crisis like Nissan was, so it resisted as soon as we wanted to make real changes,” recalls Patrick Pélata.
Wanting to break the baronnies, the new boss raises his transversal groups, these multidisciplinary groups working outside the hierarchy. “He took mimolettes of thirty-five-forty years like me, and gave us a mission of a few months on a specific subject”, last year Didier Leroy, today number 2 of Toyota.
“The successful application of a plan is 5% of strategy, and 95% of execution,” Ghosn regularly hammered to his executives. “There was a culture of speech that progressed as one went up the hierarchy. One could almost speak of a snobbery of knowledge, “he lamented in an autobiography published in 2003. Faithful to another Japanese recipe and to privilege the action in palaver, Carlos Ghosn fixed to each employee or almost individual commitments based on measurable criteria. Technique that will not be without consequences, as we will see later.
In the meantime, the manga hero unveils “Contract 2009”, a very ambitious strategic plan. Three components: multiply the profitability by two half times in four years, sell 800,000 additional cars per year, improve the quality of the models. Las! The execrable market situation in Europe, followed by the subprime crisis, is undermining all forecasts. Losange sales decline instead of climbing, the launch of several key models is postponed. “The goals were not sustainable. Strangely, what was the most successful was the most complicated and the most sensitive: the quality “, judge a posteriori actor of the time.
More than the target, this is the method that sometimes poses a problem. “Before leaving for Nissan, Carlos was an exceptional manager, who set you very high goals but really helped you. On his return to Renault, he was much less accessible. As it was also rather cold, even in a relaxed and small committee, it was not very exciting, “said a former executive of the group.
Quickly, the general stress goes up a notch. The pressure will culminate at the Guyancourt Technocentre, the heart of engineering and design, which is experiencing a wave of suicides in 2008. “The press did not miss us. There were Khmer Rouge. This crisis has created a crack in the business, between ‘ghosnians’ and others. The gap has grown since, “says a former leader of the manufacturer. At the coffee machine, pro-Ghosn are called “GADs” – for “Ghosn said”. Atmosphere.
Everywhere and nowhere
Already, the double hat of Carlos Ghosn raises question. In 2002, the man had explained to his predecessor that, of course, he could not lead Renault in addition to Nissan. But a month before his return to Renault, he calls his chairman to tell him that he has not found a successor at Nissan. “He also explained that doing both was his way of bringing groups together. Obviously, tactics did not work very well, “says an industrialist. The first concerned was also very quickly when we put the subject on the table. “Still, it did not work. He did not have time to come on the ground, he was told cracks. Orphaned by his boss, Renault? “Anyway, managing these two manufacturers at the same time, then later AvtoVAZ and Mitsubishi, it’s a crazy thing,” says an old.
In the oven and the mill, everywhere and nowhere, chaining the takeoffs and landings between Tokyo, Paris, Beirut, Rio, Davos and New York, Carlos Ghosn, however, sees as a person the great financial crisis of 2008. Alerted by Jerome Stoll, who saw the hurricane arrive from his post in America, he decides with Patrick Pélata to take the bull by the horns and to remove 6,000 posts in Europe. Maurice Lévy, the former boss of Publicis, also one of his relatives, reproaches him publicly for helping to provoke the crisis by anticipating it. If the social crisis contract with home-based unions, and financial assistance obtained from the state put oil in the finances, this early action allowed Renault to limit the case.
Better still, it was in 2009, in the middle of the worst crisis that the car has ever known, that Carlos Ghosn decided to get into the electric car. An offensive in which he will inject billions, alone against all. Sure, 100% electric models “will represent 10% of the global auto market by 2020,” he launches. The forecast will not be true, but the group is today the European leader of the thing. To believe one of his faithful, his initial motivation is not necessarily ecological. “His goal is to be able to say that Renault-Nissan made the electric as Toyota did the hybrid. “
The way is clear
That’s when he’s in the eye of the Americans. During 2009, the Obama administration is approaching to save General Motors. Bill Ford also contacts him. Both groups offer him golden bridges. The case is not done, but it seems to mark the main interested. “If I chose not to jump on these occasions, I kept in mind the level of remuneration of the market for my role,” said two weeks ago Carlos Ghosn himself, in front of his Japanese judges. No doubt this episode played a role in the financial largesse that could have been granted later at Nissan or within the Dutch structures of the Alliance.
Remaining midway between France and Japan, Carlos Ghosn sees Louis Schweitzer withdraw in May 2009. The lush period of “Renault, cars to live” ends. More and more challenged, the former king of design Patrick Le Quément leaves the group. To avoid reiterating the resounding failures of the past (the Vel Satis or Modus flops), Carlos Ghosn gives carte blanche to a newcomer, the Dutchman Laurens van den Acker. As he had done at Nissan with the unknown Shiro Nakamura.
For the most part, Carlos Ghosn will have rather preserved the legacy of Louis Schweitzer. The Logan, a very affordable vehicle, so decried in its early days in the house, has become a complete range under the Dacia umbrella. Russia, a country already prized by its predecessor, becomes a real playground with the entry in 2008 to the capital of Lada, which became last year a wholly owned subsidiary. “He has built a relationship of trust with Vladimir Putin,” blows a relative, worried about the future of this entity without Carlos Ghosn.
Citizen of the world
Above all, Ghosn-san completes the work of Louis Schweitzer by making the Regie a globalized group, poured into distant lands like Brazil, India, the Maghreb or Mexico. With him, meetings are in English. It must be said that Carlos Ghosn, more comfortable out of the arcana of the Hexagon, struggling to fit into the French politico-industrial class. “He has truly internationalized, diversified and feminized the group’s management,” said Patrick Pélata. “Renault is no longer a French manufacturer! Claimed Carlos Ghosn in the Financial Times in 2010. “
And then there is of course the deepening of the partnership with Nissan, the masterpiece of its predecessor. “This brought Renault great economies of scale, and they learned a lot from the Japanese about manufacturing and R & D. But since Carlos Ghosn did not want to arbitrate against one or the other, it limited the deepening of the Alliance. And infused the current feeling that Renault is gradually drowned by Nissan at the level of engineering, “blows a competitor.
Over the water, the performance has indeed changed sides. If Renault was in a better position than Nissan in 1999, it is far from being the case twenty years later. Over the years, the annual profits of Losange are increasingly inflated by the financial contribution of his partner. Ditto for the balance of power in terms of market capitalization: the Japanese weighs twice as heavy as the manufacturer of Mégane. Industrial level, it’s not much better. “When Nissan produces 500,000 vehicles a year in its UK plant (Sunderland), Renault produces as many in these five major French sites,” said a former Renault HR Director in 2012.
On the other hand, the Renault of today is bigger than the Régie d’antan. In fourteen years of reign, sales of Losange without Nissan increased from 2.5 million units to almost 4 million. The Dacia effect, first. Above all, the commercial base of Renault no longer depends on the Old Continent. “For the past two years, our financial momentum has been much better than that of our friends in Nissan,” says a group executive.
#Renaultgate
In the novel Ghosn, the nebula “affair of spies” takes a big chapter on its own. The drama, a dark history of manipulation of a security official leading to the dismissal of three innocent executives, takes place in 2011. At the request of Carlos Ghosn, who feared repercussions for Nissan in China (some people thought then that the “spies Renault were manipulated by the Middle Kingdom), Renault management does not ask for help from the French authorities. After having told the whole France at the “20 Hours” of TF1 that he was sure of his coup, Carlos Ghosn finally recognize the mistake – and pass Patrick Pelata, his number two, the losses and profits.
As a matter of fact, Carlos Ghosn has always had a tooth against his numbers 2. Patrick Pélata’s replacement, Carlos Tavares, will also be disembarked two years later, after publicly hammering his desire to become a caliph in the place of the caliph . “All men need to flourish. That’s why I left. The problem was the lack of visibility. At Renault, the way was not traced, “told us two years ago, the current boss of PSA. “Here, we often change number 2, Carlos Ghosn had around him a governance and a comfortable direction,” smiles a unionist. “In fact, he could not stand the thought of having someone who could shade him. As soon as Tavares raised his head, he tapped on him “, amuses a former senior leader of the group.
The scarecrow of the state
Governance, succession: it is the cocktail that has exploded more than once the French politicians. Carlos Ghosn exerts the presence of the state in its capital, even fallen to 15%. “For him, it was an active suffering,” says a big boss. Taking advantage of the vacancy of power between Jacques Chirac and Nicolas Sarkozy, Carlos Ghosn vainly tries to buy the shares of the state. The former mayor of Paris had however expressly closed the door, and his successor will end the maneuver even before living at the Elysee. This bluff, he will retry between Nicolas Sarkozy and Francois Hollande. With the same result.
So inevitably, whatever the political color of its interlocutors, it goes wrong. Especially since “Mr. Ghosn” did not want to waste his time talking to ministers or even prime ministers. His level, it was rather the Elysee. “His relationship with the state was the least of his worries. He had an execrable attitude, “confirms Michel Sapin. The latter headed Bercy the Agency of State participations in 2016, during the passage in force of Carlos Ghosn about his salary. Or the year before, during the renegotiation of the contract linking Renault and Nissan after the crisis of double voting rights. “It was the only company in the CAC 40 to refuse to apply the Florange law, to the fury of Emmanuel Macron! “Recalls the former finance minister, denouncing a board of directors” completely at the boot “of the leader.
In fact, Renault’s advice never really looked for what was going on at Nissan – which was nevertheless controlled at 43.4%. Worse (or better, depending on the point of view), explaining that the rise of the state to the capital of Renault had thrown disorder in Japan, Carlos Ghosn gets from the state that he does not mix any more current affairs at Renault – while the former Regie released the grip on Nissan. “Since then, Renault can no longer vote in AG against the resolutions of the board of Nissan, where he has no control. It’s a scandal that results from a negotiation between Ghosn and Ghosn, “protested a big industrialist close to power.
In the same vein, it puts Renault before the fait accompli when it announces the purchase of Mitsubishi by Nissan, disequilibrium for good the Alliance for the benefit of the Japanese. Some time after his arrival at the helm of Renault, he had sold the stake in Volvo, which was, in the head of Louis Schweitzer, allow the French group to catch up on Nissan.
These facts and gestures, Emmanuel Macron seems to remember them. In his time Bercy, the president had scolded Carlos Ghosn in a shattering interview with “Les Echos” in 2015 : ” It is CEO, not a shareholder! More recently, on the sidelines of the Mondial de Paris in October, the Elysee had invited the bosses of the car to dinner. Carlos Tavares was sitting right next to the president. The crime of lèse-majesté, the other Carlos was relegated a few places further. And when the latter evokes the cost of work in France, Emmanuel Macron immediately returns in his 22 pointing his salary. However, Carlos Ghosn has always saved his skin despite the ire policies. He had convinced them that without him, the Renault-Nissan Alliance would collapse. “He built this set in his hand, remarks Yves Dubreil, the inventor of the Twingo. It will not be easy for another to handle all this. “
The twilight of a king
Since the takeover of Mitsubishi by Nissan, Carlos Ghosn is very taken on the other side of the world. But in Paris, the state is worried about the future. What will happen when Carlos Ghosn leaves for retirement? In the eyes of all, he must clean the Alliance before leaving, he makes it “indetricotable”. That’s why the leader gets an extension of his term as CEO early last year. His aborted reign will not leave him time to realize the mission.
Conversely, with the contribution of Mitsubishi, the king Carlos manages to tear in extremis the crown of world number 1 of the car for his great Alliance – its leitmotiv of the last years. “It’s no secret, Carlos is rather greedy for status and recognition,” says someone who has long practiced. A few years ago, in a hurry to find his plane in London, he asked a police escort to thwart the traffic jams. “No,” the local authorities replied, much to his anger. Finally, Carlos Ghosn will have the opportunity to be accompanied – more than once – by police officers a few years later, in Japan.