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No changes for Nissan-Mitsubishi alliance – for now

Ghosn going: Carlos Ghosn announced last month that he would step down as Nissan Motor Company chief executive, handing the reins to Hiroto Saikawa as of April 1 this year.

Little impact expected in Australia from Renault-Nissan’s purchase of Mitsubishi

27 Mar 2017

THE recent takeover of Mitsubishi Motors Corporation (MMC) by the Renault-Nissan Alliance is unlikely to affect the Australian operations of the various brands in the short-term, according to Nissan Australia managing director and CEO Richard Emery.

Nissan announced in October last year that it had secured a controlling 34 per cent stake in the ailing MMC for ¥237 billion (A$2.981b), just six months after Mitsubishi admitted to deliberately misrepresenting fuel economy figures of about 625,000 ‘kei’ mini cars in Japan.

At the time of the acquisition, Renault-Nissan Alliance chairman and CEO Carlos Ghosn told journalists that the purchase of Mitsubishi would mean future-generation models would likely share underpinnings, while other cost-cutting operational changes were also anticipated.

Speaking to GoAuto at the Navara Series II and Pathfinder launch this week, Mr Emery said it was “far too early to tell” if there would be an integration of business units or other functions between Nissan/Renault (and Infiniti) in Australia – which are already closely aligned – and the Adelaide-based Mitsubishi Motors Australia Limited (MMAL).

“Over the last 15 years, the alliance has derived significant efficiencies – and even in Australia, even though it is not publicly understood, Nissan Australia does Renault’s parts logistics, a lot of the back-end stuff, just because of scale,” Mr Emery said.

“So let’s call us a big brother helping out Renault and Infiniti. With Infiniti, we have our own MD, but we do HR, treasury, parts logistics, all of those projects we do … within Nissan Australia, supporting Infiniti, and a number of tasks supporting Renault Australia.

“Is there opportunity for us as an alliance group to share some of those things (with Mitsubishi)? Sure.”

Mr Emery said there were no plans in place to combine any departments between Nissan Australia and MMAL at this stage given the global focus of the takeover, adding that the two brands – like Nissan and Renault – were still competitors.

“I think the focus at the moment is very much around the manufacturing, the procurement on a global scale. Local efforts I think will roll out over time where they are sensible, feasible and they can be aligned in terms of timing,” he said.

“Ultimately you need to remember in the eyes of consumer law and other factors, we are still competitors in marketplace. Renault and Infiniti, to some extent, are complementary brands within the alliance.

“For a market like Australia, the Mitsubishi-Nissan alliance is a bit more complicated. We are not mortal enemies, but we are competitors.”

While the company is yet to announce which models will be shared between brands, Mr Ghosn has previously said it would make sense for next-generation versions of vehicles such as the Navara and Triton to share underpinnings.

Given the focus of both brands on SUVs, it is likely that several future-generation models will be built on the same platform and, potentially, at the same factories.

Whether Mitsubishi leverages its new partnership by using some of Nissan and Renault’s passenger car architecture remains to be seen.

Last month, Mr Ghosn announced he would step down from his role as Nissan Motor Company chief executive – handing over to his deputy Hiroto Saikawa – but would continue as Renault CEO and chairman of the alliance, focusing his attention on the “expansion and stewardship” of the entire group.

While Mr Emery said he does not believe there will be any dramatic changes under Mr Saikawa’s rule at Nissan, he added that there were “lots of other changes below him” that would ensure some “personality changes in the business”.

“In the last year or so we have had a new chief global sales officer (Daniele Schillaci, filling part of the hole left by Andy Palmer, who had moved to Aston Martin) Trevor Mann, who was chief performance officer has gone off to Mitsubishi as COO and Jose Munoz, who has been running the Americas, has come in as CPO,” he said.

“When you have senior people like that change, of course there is a slight shift in personality and style. That perhaps gives you an opportunity to reinvigorate as well so I don’t think fundamentally the business will change.”

Mr Emery said the overall direction of the company, including its focus on smart mobility solutions and electrification, would continue, but the management changes were likely to mean a greater focus on the Australian market.

“All the things you heard from Carlos Ghosn over the last three or four years, nothing is going to change in terms of the direction and intelligent mobility.

But certainly, we think we will be seeing some more focus on this part of the world, which I think will be good, with some of the management changes,” he said.

“In that regard, I am very hopeful of the changes of the structure in terms of what it might mean for Australia.”

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