The partnership of Renault SA with Nissan Motor Co is no less than public relations’ nightmare

The partnership of Renault SA with Nissan Motor Co is no less than public relations’ nightmare

Since months, the partnership of Renault SA with Nissan Motor Co. has been a strain on the management & a nightmare for public relations. Now, the woes of the Japanese carmaker are hitting where it actually hurts; the bottom line.

The largest automaker of France, who owns 43% of Nissan, reported this Friday that the poor performance of its Partner in the 1st half cut net income by €21 million which is equivalent to $23.4 million. A year prior to that Nissan added €805 million.

Nissan is burning from decreasing U.S. sales & aging vehicle models. The deteriorating results come at a time of sharp tension within the partnership with Renault in the outcome of the arrest of Carlos Ghosn, their former chairman, who held the alliance together for almost two decades.

Our main priority is to help Nissan get out of the current situation, told the Chief Executive Officer of Renault, Thierry Bollore during an interview with Bloomberg Television. While Renault cut a sales target for this year, the car-manufacturer is sticking to its profit outlook in spite of the industry slump.

Contrary to this, an announcement was made by Nissan on Thursday increasing the number of jobs to double. It plans to eliminate & revealed new production cuts while reporting a 99 percent drop in profits of the first quarter. It blamed sales incentives & overexpansion under Ghosn. Deteriorating results of Nissan could help Renault take the upper hand in the teetering partnership.

While Renault has the ownership of a stake in Nissan, the Japanese automaker is the largest partner in their alliance & in turn owns 15% of the French car-manufacturer, with no voting rights. The uneven shareholding arrangement has long been a source of tension.