nissan-renault allaince

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T.Y.BBIGROUP NO.7

PRESENTS


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PRATHAMESH JADHAV 910314SANKET JADHAV 910315PRATHAMESH MESTRY 910326VIDDHESH SALVI 910333SANKET SAWANT 910337ROHIT SHINDE 910342RAJ KHATRI 89349

Nissan-Renault


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DEFINITION

Implementation of rescue measures for failingorganization

MEANING

Nissan-Renault


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MEANING FOR INDUSTRIALLY SICK COMPANIES

CLAUSES

EXCEPTION

EXAMPLE

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Nissan-Renault


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Motivation by Former Renault CEO Mr. Carlos Ghosn.

Focuses on the need for the negotiation of formal equity joint- venture.

Renault implement a common platform which would

generate significant economies in development costs.

The Strategy was to bring together engineering teams

to share knowledge.

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Renault & Nissan Alliance Resulted in improved Co-ordination and Cost Reduction.

Their Alliance Resulted in good teamwork and equal

contribution from both the end.

Renault owns 44% of Nissan Motors, Nissan owns 15%

non-voting shares of Renault. This Strategy secures

operational independence to both the firm.

Carlos Ghosn Quoted in an interview, We will never

merge the two companies. Why? Because my job is to

create value and a merger would destroy valueNissan-Renault


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Important issue in the Nissan-Renault alliance relies inthe management of two different cultures.

Mutual understanding between two different workculture.

Application of Hofstedescultural theories in thealliance.

Restructuring the Nissan management process byarrival of Mr. Carlos Ghosn.

Ghosn was indirectly forced to implement a newA system of double hierarchy

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Parent company Renault wanted to learn from Nissansuccess in North America which is essential for expand in

its market.

Before Alliance Nissan had Debt problem during 90s.

Its Debt amounted to 11.2 Billion which prevented Nissan

from making Investment in Product Line.

Products were too old to compete in Global Market.

E.g. March

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Nissan invested in many companies, Their large amountof money was locked up and could not utilized for

Nissans own good.

Renault Paid off Huge Debt in return of 36.6% Equity

stake.

Nissan had a clear distinction between customer andshareholder.

Following the alliance, nearly 14,000 employees were

unemployed. This change contributed to maximizing theutilization of personnel.

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The alliance between Nissan-Renault

Figures

Perception of Mr. Carlos Ghosn

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Strategies prepared as per host countrys

conditions.

Threatens by Japanese low price high quality car.

Building plants on Global soils.

The European Commissions new rule.

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Common platform with Nissan for small cars

Joint research projects and exchange ofcomponents (leading to standardization of theseproducts)

The decision to return to the Mexican market,using Nissans powerful industrial and

commercial presence

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Further expansion in

Europe and growth in Asia

To draw on the strengths

of complementary

expertise in sales and

technology, and to reduce

costs and enhance

performance.

Nissan-Renault

Renault CEO Louis Schweitzer and Nissan

CEO Yoshikazu Hanawa signed the

Alliance agreement in March 1999.


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PROMISED

Positive annual net income afterTax by 2000-2001

Annual operating margin of 4.5Percentage of sales by 2002-2003

50% reduction in net debt to $6.3

Billion by March 2003

Eliminate 21,000 jobs by March2003

DELIVERED

$6.5 billion 1999-2000

$2.7 billion 2000-2001

$2.7 billion 2001-2002

$4.1 billion in Mar. 2002-2003

18.8 percent by March 2002 to

March 2003

Net debt of $6.6 billion in

September 2001

19900 job cuts by September

2001

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Nissan-Renault

nissan-renault allaince

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