Renault prepares for new CEO ahead of crucial alliance meeting

PARIS – Renault SA could name a new chief executive officer ahead of a crucial meeting in Japan on Thursday aimed at showing that the deeply troubled alliance with Nissan Motor Co. and Mitsubishi Motors Corp. is moving past the Carlos Ghosn era.

The French carmaker’s board gave the green light for Luca de Meo to become the new CEO, Le Parisien reported Sunday, without saying where it got the information. A spokesman for Renault declined to comment.

The Italian, who rose through the ranks at Volkswagen AG to run its Spanish brand SEAT, has been the front-runner for months. The executive, who recently stepped down as chairman of SEAT, is “probably in talks with Renault,” VW CEO Herbert Diess said last week in Davos. Without confirming his name, Renault Chairman Jean-Dominique Senard has said an announcement could come within days.

The stakes are high for Renault and its partnership with the two Japanese carmakers. A year after Senard replaced Ghosn — who was arrested in 2018 in Tokyo on charges of financial misconduct — the Renault chairman is trying to draw a line under turmoil that nearly broke the two-decade-old alliance. He has said a series of measures will be unveiled at an alliance meeting at the end of the month to deepen operational ties between the manufacturers.

The board of the alliance will decide on new and common projects as the partnership is moving toward greater convergence of platforms and technology in the face of the massive investment needed to develop new cars, Senard said earlier this month.

According to two sources close to Renault, Gilles Le Borgne, who was hired Jan. 6 from rival automaker Peugeot SA, will meet Nissan’s Tsuyoshi Yamaguchi, the executive in charge of delivering the joint engineering projects, on Thursday.

Analysts say that in order to turn investor sentiment around, the firms need to make good on cost-saving joint engineering projects that have slowed since Ghosn’s departure.

Renault-Nissan’s cost-saving alliance is vital to both companies as the car industry battles a slowdown and huge investments in cleaner vehicles and automated driving.

“The alliance has taken a hit, but the alliance engineering team is still there,” said a third source, who is close to the alliance. “You cannot, from one day to the next, stop something that’s been embedded so deeply.”

Senard has said both sides are determined to make the partnership succeed, with the joint projects a major focus.

One area of focus will be hybrid power systems, a field where, analysts say, the alliance has not effectively pooled its research and development efforts. Each of the three members of the alliance has developed their own systems.

“That’s been among the sources of the friction,” said the third source close to the alliance. “But now the three systems are there, we’ll need to use them in the most efficient way possible.”

Nissan will use the E-Tech hybrid system developed by Renault on its Juke small SUV, while Renault will use the Nissan-developed e-Power system on its Kadjar model, particularly in Asia, according to the same sources.

Mitsubishi Motors is still using its own hybrid system on its best-selling Outlander.

Ghosn held the partnership together for years despite a lopsided shareholding relationship favoring Renault that was put in place when Nissan was financially ailing. His arrest brought resentment between the companies to the surface. Senard has said changes in top management have eased the tension.

The French carmaker owns 43 percent of Nissan, with full voting rights, while the Japanese company holds only a 15 percent stake in Renault and lacks the ability to vote. Ghosn has denied the Japanese charges and at the end of last year fled to Lebanon, where he has mounted a media campaign to clear his name and lob criticism at Renault and Nissan.