Carlos Ghosn is Brazilian, he is 70 years old and this summer he announced that Honda intended to Buy Nissan. He probably knew what he was talking about considering that, in his day, he became CEO of Nissan, Renault and president and CEO of the alliance between the two companies.
It is also likely that he knows well what he was talking about because his career at the head of both companies was marked from the first moment by the purely financial aspect. Some accounts that, in fact, ended up making him flee Japan stuffed in a suitcase.
Since then it has been in “search and capture”.
This is your story.
The “cost killer”
O The Cost Killeras they called him after his time at Renault.
Because it was precisely in France where Carlos Ghosn launched his business career. Although Brazilian by birth, Ghosn’s grandfather was Lebanese (something essential to fully understand this story). Bichara Ghosn emigrated to the South American country and raised his family there through companies of all kinds, immersed in agricultural products and even aviation.
Although the family remained in Brazil, Ghosn moved to Lebanon when he was still a child who had been affected by drinking bad water when he was just two years old. Upon his return to Lebanon, Ghosn excelled in his studies and became an engineer. This led him to go to France, where he became part of the Michelin staff.
Although he had only been a graduate for three years, in 1981 he took the reins of a French tire company plant and rose at such a speed that in 1985 he was already directing Michelin’s operations in South America as COO of the company in that market. The challenge was to return profitability to a division that was failing. A challenge from which he probably learned many things that he would apply later.
After managing to return its division to profitability in two years, Renault set its sights on the Brazilian of Lebanese origin. In 1996, the French company found itself in an extremely complicated situation. With billion-dollar losses, the closure of its Vilvoorde plant (Belgium) and the dismissal of 2,764 French employees, a renewal was urgently needed.
The leadership was taken over in 1999 by Ghosn, who undertook a tough path of adjustments with which earned the nickname “cost killer”. He made the decision to create the famous alliance with Nissan (the same one that today hangs by a thread) and launched all kinds of adjustments. Acquiring 36.8% of Nissan allowed Renault to access technologies that, until then, were out of its reach, in addition to sharing developments with the Japanese company (saving money along the way) and opening up to new markets. Over time, the French position strengthened until it owned 43% of Nissan.
The restructuring was, however, completely traumatic for both companies. In total, 21,000 jobs were eliminated, they explain in The Information. Like Renault, the Japanese were immersed in a harsh crisis. Despite their past successes, they only had three models among the 46 best-selling cars in Japan.
Ghosn’s leadership at Renault and Nissan was marked by plant closures, thousands of layoffs… and the return to profitability
Over time, the harsh adjustments paid off. First at Renault, where it returned to the path of profits in the 2000s although, at the end of the decade, a really complicated situation would once again occur. With a supply that was too dependent on Europe, the economic crisis of 2008 wiped out sales, reducing them by 57% and reducing profits by 78%.
The French managed to get ahead thanks to the help of the French State (which provided 3,000 million euros) and the application of the same policies that had worked previously: thousands of layoffs. Specifically, the message was sent that the workforce had to be reduced in 9,000 fewer employees who would come out of incentive leave, half of them in France.
Meanwhile, Nissan lived within a restructuring plan that had shaken all the foundations on which Chinese companies were built. Ghosn’s leadership closed five factories and laid off thousands and thousands of employees. In a culture in which conservatism prevails, it is likely that echoes of the past have encouraged the Japanese government to pressure Honda to rescue Nissan this time, trying to close the door to the Taiwanese Foxconn, which seems to want to take sides in it. .
One way or another, Carlos Ghosn achieved what, in the 2000s, seemed impossible: Nissan and Renault were profitable. The feat was such that they explain in Expansion that the manager would have started calling himself “refounder of Nissan.” A spirit that should have been short-lived because in 2018 Justice knocked on his door and Carlos Ghosn disappeared.
The fall (and escape) of Ghosn
It was November 2018 when Japanese police officers arrested Carlos Ghosn in Tokyo as he was about to take a flight at Haneda airport.
Ghosn was accused of diverting part of his salary for years, in order to avoid paying taxes, and using Nissan money for his personal expenses. In fact, it was an internal investigation of the company that uncovered the alleged appropriation of funds of the company. In total, it was estimated that Ghosn, who had a salary of six million euros according to Expansion and was one of the most powerful managers in the industry, he would have diverted 38.5 million euros between 2011 and 2015.
The accusations were especially serious but the Japanese Justice left the manager on conditional release, after paying a million-dollar bail, pending a new court date. An appointment that never took place because, without knowing very well how, Ghosn disappeared from Japan. Shortly after, it was learned what had happened to the manager. He was in Lebanon and, since then, he has been fleeing from Japanese justice there.
But how could it be that he had taken a flight and left the country without anyone knowing? The topic is discussed in Apple TV+ docuseries call Wanted: Carlos Ghosn. It recounts Ghosn’s escape to Lebanon, where he had a passport thanks to his grandfather’s origins, and in which the director himself speaks.
As it turned out, Ghosn had the help of an American father and son, as he explained to BBC. Faced with an accusation that could lead him to spend 15 years in prison, the Brazilian of Lebanese origin managed to evade justice by leaving the country packed in a suitcase. Specifically, in the boxes used to transport music equipment.
To do this, he claims he took a bullet train from Tokyo to Osaka, dressed in jeans and a T-shirt so as not to attract attention and not be associated with the suited manager who had appeared on television. There, in Osaka, the instrument carrying case was waiting for him in a room. He got inside and two Americans posed as the musicians who were going to take a private plane.
Michael and Peter Taylor, the American father and son who helped Ghosn escape, were arrested in the United States in 2020 and extradited to Japan, where they were sentenced to two years and 20 months in prison, respectively.
Since then, Ghosn has defended his innocence from Lebanon and an Interpol arrest warrant is pending against him. Despite everything, the cross demands between the companies and the manager continue to fill headlines from time to time.
In 2020, the manager denounced Renault demanding that they pay him the retirement they owed him, ensuring that his resignation was “a farce.” Last year, Ghosn himself claimed compensation worth 995 million euros from Nissan for “deep damage” to his finances and reputation. However, last September 2024, the court of the British Virgin Islands, used by Nissan to try to recover part of the money supposedly lost, ruled that Ghosn had to deliver 32 million euros to the Japanese company as compensation and return one of his yachts.
Five years after his escape, everything indicates that the bizarre story of Carlos Ghosn is not over.
Photos | Thesupermat and Wikimedia
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