Carlos Ghosn, chief of Nissan and Renault, faces arrest in Japan

Marcus Newton
November 19, 2018

Nissan's revelations came after Japan's Asahi Shimbun newspaper and broadcaster NHK reported that prosecutors were questioning Ghosn on suspicion of under-reporting his salary and may arrest him.

According to the statement, Nissan CEO Hiroto Saikawa will ask the automaker's board of directors to remove Ghosn from his position as chairman.

It said it had been conducting an internal investigation for several months, prompted by a whistleblower. "Saikawa will also propose the removal of Greg Kelly from his position as Representative Director".

Ghosn has been regarded as the glue holding together the sprawling alliance of Nissan, Renault and Mitsubishi, and questions have been raised in the past about how his eventual departure might affect the coalition.

Renault said in a statement on Monday that it had seen the Nissan announcement and would hold a meeting of its board of directors shortly.

Ghosn, who is also CEO of French automaker Renault, served as CEO of Nissan from 2001, after Renault bought a controlling interest in the company, until 2017.

Japanese prosecutors have yet to comment on Mr Ghosn's arrest.

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Ghosn, 64, is described by the Guardian as "one of the world's most powerful auto bosses" who "has managed the seemingly impossible job of running one carmaker in Japan, and another in France". "We will continue to do so", said the company's statement.

The Japanese automaker said Ghosn's alleged misconduct included personal use of company money and under-reporting how much he had been paid.

According to NHK and the Kyodo News Service, Nissan paid Ghosn almost $89 million over five years through March 2015, including salary and other income from the company, but reported as if he only made 5 billion yen ($44 million), or half of what he had received.

In 2016, 54% of Renault shareholders voted against Ghosn's €7.3 million pay package for 2015 - Ghosn's Nissan earnings were fairly close.

The ousting leaves the Renault-Nissan-Mitsubishi alliance - the maker of one in every nine cars manufactured worldwide previous year - without its totemic leader as the electric and autonomous vehicle revolutions threaten to upend the business models of established auto manufacturers. Ghosn's slow retreat from his roles at each company-including stepping down as Nissan's CEO previous year and suggesting he may step down from his post as CEO of Renault before the scheduled end of his term in 2022-have sparked rumors that he wasn't on board with plans for further integration and might be thinking of leaving the alliance anyway.

Initially Ghosn, his nickname was "Le Cost Cutter", inspired fears of social and economic upheaval amid plant closings, mass layoffs and the potential damage his reforms might inflict on Nissan's ties with its suppliers. Ali Kaya, who heads the CGT union at a Renault factory in Flins outside Paris, said "the most shocking thing is that these people were not arrested well before this". Renault now owns a 43.4 percent stake in Nissan, which in turn owns a 15 percent stake in its French peer and a 34 percent in Mitsubishi Motors.

Other reports by MaliBehiribAe

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