Nissan, Renault Reach Deal on Alliance Shake-Up
Wall Street JournalNov 02, 2022
The Facts
On Monday, Nissan Motor Co. and Renault SA agreed to restructure their two-decade-old auto manufacturing alliance to put the two companies on an equal investment footing, ending almost four months of intense negotiations.
Under the new contract, Renault will lower its 43% stake in Nissan to 15%, transferring a 28.4% no-vote share into a French trust. Nissan, which previously held no voting rights, will now have an equal 15% voting rights share, though Renault will retain its financial profits from the trust.
The Spin
Narrative B
This deal seems to strengthen the relationship between Nissan and Renault. From a shareholding perspective, Nissan is finally getting the equal footing it has long desired, and on the investment side, both parties seem eager to invest in electric vehicle technology together. This is the start of a new prosperous era of an already successful auto industry power couple.
Narrative A
Although this agreement gives a more fair share to Nissan and boosts investment for both parties, it doesn't solve the many differing opinions on business tactics between Yokohama and Paris. Unless they figure out some sort of joint board chairmanship, the debate over future investments will be continual, and road bumps will be unavoidable.