On November 19, 2018, Nissan President Carlos Ghosn was arrested while passing through Tokyo Haneda Airport. He was ultimately charged with underreporting his income and using millions of Nissan funds to cover lost personal investments, and if convicted he faced up to 15 years in prison. But after spending 130 days in custody and posting $ 13.7 million bail, he fled Japan for Lebanon, hiding in an audio equipment box as he was flown in a private jet. He now lives in Beirut, beyond the reach of Japanese prosecutors.
It’s an amazing story, but only a small part of what Hans Greimel, a veteran auto industry journalist, and William Sposato, a Japanese-based journalist for many years, choose to tell in “Collision Course: Carlos Ghosn and the Culture Wars It turned an automotive empire upside down. The book by MM. Greimel and Sposato is less of an account of the rise and fall of Mr. Ghosn than an examination of the differences in corporate, legal and political cultures between Japan and the West. How is it that such advanced economies and societies are so often mistaken? And was Mr. Ghosn simply a victim of this historical pattern?
Mr. Ghosn was born in Brazil to a family of Lebanese origin. As a child, he moved to Lebanon and then to France, where he stayed, obtaining two engineering degrees and climbing the ranks at Michelin and later at Renault. A French, Brazilian and Lebanese citizen, he is fluent in English, French, Portuguese and Arabic. In 1999, when Renault invested in Nissan, Mr. Ghosn was appointed COO of the Japanese automaker.
Collision course: Carlos Ghosn and the cultural wars that turned an automobile empire upside down
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At Renault, headquartered near Paris, Mr. Ghosn was known as “The Cost Killer” and in his new role he more than lived up to his reputation. It cut jobs, closed factories, paid off debts and renegotiated with suppliers, disregarding Japan’s warm corporate networks and traditions. Within three years, Mr. Ghosn had become general manager and Nissan was back in the dark. He lived the role of the corporate globetrotter titan, making frequent flights between Tokyo and Paris and elsewhere, preaching the importance of scale in the auto industry. In the meantime, he and his wife raised four children, before divorcing in 2012. When Mr. Ghosn married a second time in 2016, he celebrated with a party at the Palace of Versailles that would symbolize his growing pride.
While other international auto partnerships have failed, including Daimler-Chrysler and Volkswagen-Suzuki, Mr. Ghosn made Renault-Nissan work. He capped his career in 2016 with the purchase of a majority stake in Mitsubishi, creating the world’s largest automotive group. One of Mr. Ghosn’s former advisers told the authors of Collision Course that what his boss was trying to do “was unprecedented in the history of the auto industry, which was to combine strong companies that are really important at the national level and to keep them together ”. not just for an economic cycle, but in a way that “was really permanent”. Given the economic and symbolic importance of the auto industry, it also frequently had to manage the attention of prying politicians.
Yet he never imagined he would be arrested and threatened with years in prison. In one version of this story, Mr. Ghosn was the fall guy in a battle between the French at Renault and the Japanese at Nissan. Mr Ghosn himself recalls the moment in 2018 when Renault urged him to make the alliance with Nissan “irreversible”. The Japanese were not so enthusiastic about the idea and began to plot to block the French plans. Bringing down Mr. Ghosn has become essential.
According to Nissan, however, Mr. Ghosn was an outright con artist. He regarded the company’s money as his own and surrounded himself with men who were too scared to hold him to account. An internal report commissioned after his arrest concluded that within the company, Mr. Ghosn had been “deified” as “a savior who saved Nissan from collapse and that his business was seen as impenetrable territory.” He concluded that Nissan suffered from a “corporate culture in which no one can object to Mr. Ghosn”.
In an interview in 2020, Mr. Ghosn said his rigorous leadership style was essential. “Between 1999 and 2018 you never heard of a problem because obviously I was the final decision maker, I instilled a spirit of cooperation against extremes. But we knew the extremes were always there. They would always take advantage of any situation to make their opinion prevail. They accused me of being a dictator, but frankly I was a decision maker. One man’s decision-maker, another’s kleptocrat.
MM. Greimel and Sposato describe the Japanese legal system as a system “where prosecutors exercise a great deal of power and acquittals are rare”. Defense lawyers are not allowed to attend interrogations, making suspects vulnerable during long periods of custody. Mr. Ghosn was subjected to many hours of questioning. Japanese prosecutors point to their 99% conviction rate as proof of their effectiveness. Others say it suggests a system heavily tilted against the accused.
Upon arriving in Beirut, Mr. Ghosn said: “I have not fled justice, I have escaped injustice and political persecution. In a subsequent interview, he described the experience of his arrest: “It doesn’t just sound like a Kafka novel. It’s a novel by Kafka. Despite everything he had done for Renault, Mr. Ghosn was quickly abandoned by the French, especially President Emmanuel Macron, who had no interest in defending a business leader at a time of social unrest in his country.
MM. Greimel and Sposato write that their central figure remains a mystery: “Perhaps those who understood Ghosn best can really tell if he was a sentimental family man or a cold and calculating business leader, a visionary innovator or an egocentric autocrat,. . . the unsuspecting coup victim or just a C-suite crook. ”Is it possible, the authors ask, that it was a“ complicated combination of all these things ”? In the absence of a trial, the truth about this bizarre case may never be fully known.
Mr. Delves Broughton is the author of “The Art of Selling: Learning From The Masters About The Business Of Life”.
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