$100 Billion Auto Giant in the Making: General Motors, Renault, and Nissan

Strategic Insights -

A major alliance between General Motors, Renault, and Nissan is on the horizon, potentially creating a $100 billion global auto giant. This partnership, proposed by billionaire investor Kirk Kerkorian, would see French carmaker Renault and Japanese carmaker Nissan team up with the US-based GM. The alliance would put Carlos Ghosn, the Brazilian-born French executive of Lebanese parents, at the helm of the combined entity, which would rival Japan's Toyota in the global auto market.

Key Takeaways:

  • The proposed alliance would see General Motors, Renault, and Nissan come together to create a $100 billion global auto giant.
  • The tie-up would put Carlos Ghosn, the CEO of Renault and Nissan, in charge of the combined entity.
  • Renault would need to obtain the full support of General Motors' board and management before any study of the plan can take place.
  • A 20% stake in General Motors, which could cost Renault around £1.8 billion, has been proposed as part of the deal.
  • Analysts have expressed doubts about the benefits of the deal for Renault, citing the risks involved in a large-scale acquisition.
  • Renault already owns the Romanian Dacia brand and has a stake in Samsung Motors of Korea.
  • General Motors is the maker of Cadillac, Corvette, Saab, Hummer, Opel/Vauxhall, and Chevrolet cars.

Statistics:

  • Market value of Toyota: $190 billion (£103 billion)
  • Potential cost of a 20% stake in General Motors: £1.8 billion
  • Estimated cost of a 10% stake in General Motors: £902 million
  • Renault's stake in Nissan: 44%
  • Renault's stake in Samsung Motors of Korea: unknown

Sources:

  • "US carmaker's plan for a tie-up with Renault is on renewables' board" by Deborah Haynes, The Sunday Telegraph, ( no date provided)
  • "Ghosn plans to use Renault to conquer Toyota" by Robert Trend, Financial Times, (no date provided)