Reflections on Ghosn’s “Victory Run”

Nissan ’s former chairman Ghosn ’s “victory escape” from the eyes of the Japanese police has aroused widespread concern in the international public opinion. Regarding the process of the escape and the case itself, Ghosn and the Japanese side hold their own words. Instead, focus on the “universal” issue reflected by the incident.

With the acceleration of globalization, “cross-border mergers and acquisitions” has become a new normal. France and Japan also play a pivotal role in the world’s automotive industry. It is the acceleration of globalization that has caused the two major auto nations in the east and the west to closely intertwine. In 1999, Renault spent USD 5.2 billion to acquire a 36.8% stake in Nissan, a 22.5% stake in Nissan ’s Japanese Nissan diesel cars, and Nissan ’s five European financial subsidiaries. At the beginning of the “marriage”, the two sides met very well. In 1999, Nissan’s share of the Japanese market had been declining for 27 consecutive years, and its liabilities reached 2.1 trillion yen. The French side treats the Japanese side with its overseas business development needs. At this stage, I believe that both French and Japanese will firmly believe that “capitals have no borders”.

However, as with most utilitarian marriages, the problem has gradually emerged over time. Investigating its roots, this merger is much more complicated than general cross-border mergers and acquisitions. In addition to the dispute between the two companies’ interests, it is also mixed with the dispute between the French and Japanese auto industries and the overall industrial strategy. When this alliance company’s performance is sluggish, the contradiction will not be obvious, and once Ghosn’s drastic reforms make the company plump, “capital without borders” will begin to fail. The country has the upper hand.

If we only look at the lessons learned from Renault’s acquisition, we can draw some conclusions. First, the pursuit of “social benefits” by the acquirer is extremely important. Ghosn has dedicated 17 years to Nissan. Why are the Japanese not grateful? Ghosn ’s three-year revival plan for Nissan includes “introducing 22 new products in three years, reducing production costs by 20%, cutting 21,000 jobs, closing 5 factories, and cutting off businesses that have nothing to do with cars. This plan only After two years of implementation, Nissan has turned losses into profit. However, whether it is 21,000 layoffs or a significant reduction in the number of suppliers, it is only pursuing the “economic benefits” of the enterprise and neglecting the consideration of “social benefits”. It’s not hard to understand the side effects that eventually broke out.

Second, we must respect local culture and social customs. To some extent, Japanese companies and society may have problems of obscured ideas and conservative styles, but the key lies in how to look at differences in different cultural backgrounds. Ghosn revealed in his autobiography “The Renaissance Extremely Riding Nissan” that he even rejected Japan’s culture and social customs, and even complacent for this, undoubtedly laying a foundation for future problems.

In addition to the shock that “Ghosn’s Escape” brought to the world, more of it left a lot of reflection, reflecting the risks and hidden dangers of “international mergers and acquisitions.”