Renault and Nissan look to join GM together

[Felony]

THE boards of Nissan and Renault have voted to explore a historic three-way alliance with General Motors, putting pressure on the embattled automotive giant to decide whether it wants two foreign companies, and their charismatic chief executive, Carlos Ghosn, to play a role in its restructuring.

A full-scale alliance would create a $US100 billion ($134 billion) car group.

The move comes as the latest US sales figures, for June, show a fall of almost 26 per cent for GM while its rival Toyota gained almost 15 per cent. Passenger car sales overall fell 9.7 per cent as many motorists apparently remained wary of continued high petrol prices and waited for a new round of discounting.

GM's board, which held an emergency meeting last Friday, when the proposed deal was unveiled by its biggest shareholder, Kirk Kerkorian, is scheduled to meet again this Friday.

GM made no comment.

The GM board's decision will determine whether discussion of the alliance moves forward, since both Nissan and Renault said on Monday that they would explore the venture only if GM went along.

The boards' actions, taken at meetings in Tokyo and Paris, were not a total surprise. After all, Mr Ghosn, the multilingual executive of Lebanese descent who runs both companies, teamed with Mr Kerkorian to float the idea.

But the boards' action lends new weight to their direct challenge to GM's chief executive, Rick Wagoner. He has withstood challenges to his leadership thus far, and taken drastic action in recent months to try to turn the company around, including closing plants and offering buyouts to tens of thousands of workers. But GM's board, and the company's investors, now have a new alternative to consider besides Mr Wagoner's plans.

Under the $US3 billion plan, Renault and Nissan would each buy 10 per cent stakes in GM. Kirk Kerkorian's company, Tracinda, holds 9.9 per cent.

The deal would put about 30 per cent of GM in the hands of two foreign companies and Mr Kerkorian, an unpredictable investor who has pushed Mr Wagoner for quicker action.

Although Renault and Nissan have said they will wait for GM's response, the company may have trouble making the issue go away even if it wants to.

Although GM's board gave Mr Wagoner a vote of confidence earlier this year when the company's financial crisis was at its height, Jonathan Steinmetz, a Morgan Stanley analyst in New York, said the directors would have a difficult time disregarding Mr Ghosn, given his success at Nissan.


http://www.smh.com.au/news/business/renault-nissan-plan-for-gm/2006/07/04/1151778937344.html

[Fnomna]

Interesting. Might be a bigger parts bin to pick from for Holden.
Remember the Falcon ute (around XF) rebadged as a Nissan?:lmao: (anyone got a pic?)
Could we see the same again - 350Z with a LS2 in it?

[VE Turbo]

Don't forget Holden already had re-badged Pulsers and the 3.0 litre 6 in the not too distant past...

[Marco]

I hear the next Nissan Cedric will be a rebadged VE.

[FunkyPig]

Doesn't work as far as their products are concerned. Nissan/Infiniti competes with all of GM brands in North America and its the same with Renault and Opel in Europe. I really hope this doesn't happen, it would ultimately mean less variety and interesting cars for people around the world, and also many closed factories.
I really hope GM can fix itself.

[Stevotski]

Given the recent quality of Nissan vehicles this could only be a BAD thing

[tbearz]

does this mean skaife would be back at the mountain in godzilla??

[monaroCountry1]

GM is a huge player in the automotive industry. I dont see any reason why it would want to align themselves with a much smaller company.

Technology wise GM is also in a far better position, as much as many of you guys might disagree with me. This is especially the case with ethanol and hybrid fuels. From recent reports Japan should have its ethanol cars ready by 2010 (excluding toyota), GM and even Holden already have production ethanol cars, currently Holden exports its E85 commodores to Brasil.

Nissan also doesnt have any strong foothold in America, Europe and Asia. GM is well established in America (chev, GMC, et al), Australia (Holden), Europe (Vauxhall, SAAB, and opel), and Asia (Daewoo).

GM is the first/second largest company in China, which is the third largest vehicle market. Recording a 47% increase in the first half of this year (457,832 units). Daewoo have also reported a 34% increase to 126,616 units to date.

GM's problem is NOT technology, its NOT its inability to sell its cars but instead the burden placed by its auto unions (UAW), especially in very costly health benifits.

However with Bob Lutz at the helm GM is quickly turning this around.

[monaroCountry1]

GM Daewoo June sales up 34% on year to 126,616 units
Jul 3, 2006


SEOUL (MarketWatch) -- GM Daewoo Auto & Technology Co. said Monday that its June auto sales increased 34% on year to 126,616 units from 94,727 units on stronger local sales and exports.

Domestic sales rose 8.2% on year to 10,124 units last month lifted by strong sales of the Tosca midsize sedan, company data showed.

Exports jumped 37% from a year ago to 116,492 units.

"GM Daewoo will benefit in the second half from the roll out of the Tosca and Winstorm in global markets as well as our new family of diesel engines," GM Daewoo's chief executive Nick Reilly said in the statement. "As a result, we anticipate continued growth in sales in the domestic and global markets."

GM Daewoo launched the Tosca in early 2006 and last month, it unveiled its first sport-utility vehicle Winstorm, which will be marketed from this month.
Month-on-month, GM Daewoo's domestic sales rose 5.9% in June from 9,559 units in the previous month while exports dropped 4.1% from 121,419 units shipped in May.

During the first half, GM Daewoo sold 733,420 vehicles - a six-month record high - up 44% from 507,910 units sold in the same period a year earlier.
The carmaker sold 55,597 units at its home market in the first half, up 4.0% on year.

Exports were up 49% to 677,823 units over the same period as the company's vehicles sold well in more than 150 countries.

GM Daewoo, the South Korean unit of General Motors Corp. (GM), is targeting to sell 1.6 million vehicles at home and abroad for all of 2006, compared with 1.15 million units a year ago.

GM says China sales rose 47 pct in H1 2006


SHANGHAI (Reuters) - General Motors Corp. (GM.N: Quote, Profile, Research), the world's largest auto maker, said on Tuesday its sales in China rose 47 percent in the first half of 2006, as it benefited from a stronger-than-expected domestic market.

GM sold 453,832 vehicles in the world's third-largest vehicle market in the six months through June, versus 308,722 units in the same period a year earlier, it said in a statement.

For Nissan

Nissan faces costly recall


LOS ANGELES - Nissan North America could face a hefty price tag to remedy a recall of 96,800 2006 Nissan Altimas and Sentras, which may consume an inordinate amount of oil and cause engine fires.

In a June 16 letter from Brad Bradshaw, Nissan's incoming senior vice president for sales and marketing, the company told dealers that it would pick up vehicles from dealer inventories, transfer them to Nissan facilities for inspection, and return them after inspection and repair.

"We have not made a blanket statement that we will replace all the engines, but we are saying we will make the customer satisfied - whatever it takes," said Nissan spokesman Fred Standish in Nashville. "Fix it, repair it, replace it - whatever is necessary."

Losing Steam
Nissan's six-year upswing shows signs of slowing


NASHVILLE -- Suddenly, Carlos Ghosn's six-year winning streak is looking shaky.

Last year he successfully concluded an ambitious three-year plan to add 1 million sales globally and post operating profits equal to 8 percent of global revenues.

But in May, U.S. sales fell 7.3 percent for Nissan North America Inc., including an 11.7 percent drop at Infiniti Division.

The company has scheduled six extra days of production shutdown at its two big U.S. factories, in Smyrna, Tenn., and Canton, Miss., to prevent inventories from bloating. This month, the Japanese home office also trimmed daily production at two factories there, one of which assembles the Infiniti G35, M45 and Q45 for North America.

Nowadays, Nissan looks more like a cyclical Western company than the quintessential Japanese corporation, Toyota Motor Corp., which reveres relentless, incremental growth.

To complicate things, Nissan has had to halt the global sale of some 2006 four-cylinder Altimas and Sentra SE-Rs built from January through mid-May of this year because of evidence of engine fires.

.....In the same vein, Nissan's U.S. challenges are milder than those in its home market. Nissan's Japanese sales plunged 18.5 percent in April. Ghosn's COO in Japan, Toshiyuki Shiga, said earlier this month that the sales dip was a "backlash" from last year's sales push.

"We totally expected a backlash, but the decline exceeded our expectations," he said.

Asked whether Nissan's targets under the 180 plan, which ended March 31, 2005, might have pulled ahead U.S. sales from the current year, Ghosn gave an adamant "no."

[OzJavelin]

American Motors aligned themselves with Renault in the eighties ... American Motors went to poo shortly thereafter ...

[gibbons]

:( :bawl: :(

Oh dear..........:errr:

[planetdavo]

Component sets, eg parts of chassis structures etc, are the likely links if this goes ahead. That is where the BIG costs are for all manufacturers.

[Ghosn]

THE boards of Nissan and Renault have voted to explore a historic three-way alliance with General Motors, putting pressure on the embattled automotive giant to decide whether it wants two foreign companies, and their charismatic chief executive, Carlos Ghosn, to play a role in its restructuring.

Dammit, he stole my name!!

[monaroCountry1]

Component sets, eg parts of chassis structures etc, are the likely links if this goes ahead. That is where the BIG costs are for all manufacturers.


Sharing components and structures would definately lower costs, however GM's already restucturing itself so that it could utilise its global resources. Thw LSx V8 engines in your normal commodore could be found throught the GM empire, the zeta platform in the upcoming VE would eventually find its way to north american RWD cars, Daewoos small cars are already finding its way throughout GM's various divisions.

Adding Nissan to the empire would not benifit GM !!!!!!!!!

[planetdavo]

Sharing components and structures would definately lower costs, however GM's already restucturing itself so that it could utilise its global resources. Thw LSx V8 engines in your normal commodore could be found throught the GM empire, the zeta platform in the upcoming VE would eventually find its way to north american RWD cars, Daewoos small cars are already finding its way throughout GM's various divisions.

Adding Nissan to the empire would not benifit GM !!!!!!!!!
Nissan could bolster markets that GM are weak in, the same way that GM's large rear drive platforms could provide more Nissan large product. We could have a Zeta Skyline or Infiniti! Still looks like a Nissan, but with a Commodore based chassis.....
It's all speculation about possible outcomes anyway, from anyone responding to this thread......

[CraigH]

Ghosn has turned around both Nissan and Renault.

His management of both of those companies has been regarded highly by all analysts.

They may not be the strongest japanese and european companies in the US but GM is equaly not as stong in their home markets.

GM may have some great technology in the performance space but their average cars & Trucks (the ones they sell most off in the US) are less than average and can compete on only price.

GM is also paying the price for bad management over many years.

Lutz while a visonary is not running GM and lost power last year when he was moved aside.

This move is seen as getting someone in who knows how to bring companies back from the near dead.

I doubt platform sharing is near the top of the list of things to do, it will be fundamental changes in how things are done that will turn it around.

[monaroCountry1]

Nissan could bolster markets that GM are weak in, the same way that GM's large rear drive platforms could provide more Nissan large product. We could have a Zeta Skyline or Infiniti! Still looks like a Nissan, but with a Commodore based chassis.....
It's all speculation about possible outcomes anyway, from anyone responding to this thread......


Nissan doesnt have any products that it could share with GM. A zeta skyline is a good idea but is not needed. GM already has better performance cars of its own in the vette and the caddies (and even Holdens).

[monaroCountry1]

........................

[monaroCountry1]

Extracts from Reuters


-Wagoner and his management team intend to treat the alliance proposal as a hostile move against management
-Worldwide sales at French carmaker PSA Peugeot Citroen were up 0.6 percent at 1.764 million vehicles in the first half of the year while sales at national rival Renault declined 3.2 percent to 1,315,385 cars
-GM views Renault and Nissan as companies that cannot really help the US automaker. GM also feels an alliance is not needed because the company's turnaround is starting
-The procedural argument will be that Kerkorian and his representative on the GM board, Jerome York, might have violated 'protocol' by meeting independently with Nissan and Renault's CEO Carlos Ghosn to discuss allying GM with the two automakers

Now most importantly

-The report added that GM's management is considering whether to mobilize the United Auto Workers union, Michigan politicians and selected media as part of its response to the alliance proposed by Kerkorian. "

From
http://www.forbes.com/home_asia/feed...fx2860342.html


----------------------------------------------------------------------
another....

Now Nissan wants into this deal to get some penetration onto North America, again GM has got nothing to gain from this deal.

http://vh10924.moc.gbahn.net/apps/pbcsi.dll/bilde?Site=C3&Date=20060706&Category=AUTO01&ArtNo=607060379&Ref=V2&Profile=1121Q=100&MaxW=500

-"This has to be approached with enormous caution," said French Industry Minister Francois Loos. "The United States is an immense market, a complicated market, and General Motors is in a difficult situation because of problems that have nothing to do with cars."

-Japanese auto analysts were also questioning whether Ghosn could solve GM's problems.

-In a prior meeting with Kerkorian and York, Ghosn said Nissan might be able to use some of GM's idle light-truck production capacity in North America as it expands its truck lineup.

-Renault and Nissan seem likely to benefit from GM's large presence in Latin America, Russia and in China, where it is one of the leading foreign automakers.


If the UAW union gets mobilised and react badly to this attempted takeover then it might mean game over for Nissan in North America.