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- Carlos Ghosn, a legend in the auto industry has reportedly been arrested.
- The longtime leader of the Renault-Nissan alliance allegedly engaged in misconduct, CNN reported.
- Ghosn has been considered one of the most effective leaders of the past two decades in the car business.
Nissan Motor chairman Carlos Ghosn has been arrested, the Yomiuri daily said on its website on Monday.
The Japanese automaker said earlier on Monday that Ghosn had used company money for personal use and that it had been investigating possible improper practices of Ghosn and Representative Director Greg Kelly for several months.
Ghosn is one of the most prominent auto executives in the world and a legend in the industry. He has presided over an alliance between Nissan and Renault that created a global automotive powerhouse.
Ghosn, 64, was until last year the CEO and Chairman of Nissan, when he gave up the CEO role. More recently, Ghosn ascended to the chairmanship of Mitsubishi, when the struggling Japanese carmaker joined the alliance. The expectation was that Ghosn would reverse Mitsubishi’s fortunes, as he had Renault’s and Nissan’s before, transforming the alliance into the world’s largest automaker by sales volume in 2017.
CNN reported that “Nissan said in a statement that it had been investigating Ghosn and another board member for months, and was now cooperating with Japanese prosecutors.”
Spectacular rise and possibly a spectacular fall
The Brazilian-born Ghosn turned around both Renault and Nissan in the 1990s and early 2000s and is widely considered to be among the most capable leaders in the industry. Prior to the financial crisis, Ford courted him take over the American automaker as CEO (former Boeing executive Alan Mulally wound up getting the job), and prior to its 2009 bankruptcy, General Motors and activist investor Kirk Kerkorian agitated to install Ghosn at the top.
Ghosn was an early advocate for electric cars, outlining a zero-emissions strategy for Nissan before the financial crisis and greenlighting the Nissan Leaf all-electric vehicle, which launched in 2010. At the time, it was the fist practical car that ran on electricity and provided decent range.
If the charges prove true, this would be among the most stunning scandals and public falls in this history of the car business, the downfall of an individual who exploits had been chronicled in a Japanese comic book.
Ghosn occupied a unique position in the insular world of the Japanese auto industry. He was an outsider who led a globetrotting lifestyle and was significantly compensated for his efforts. He was paid $6.5 million in 2017, according to the New York Times, but had lobbied for an increase to $8.5 million.
This generated controversy in France, where the state owns 15% of Renault. It also didn’t go down well in Japan, where executive has traditionally avoided large pay disparities between leaders and workers.
(Reuters reporting by Elaine Lies; Editing by Himani Sarkar)