PARIS – A leadership crisis in the world's largest bilalliance deepened on Tuesday when the French car manufacturer Renault prepared to apply for a temporary authority to fill the gap left by the arrest of Carlos Ghosn in Japan over alleged financial default.
Prosecutors investigate claims that Ghosn, managing director of Renault, chairman of Nissan, and chairman of Mitsubishi Motors, underestimated his taxable income by half for several years.
Herr. Ghosn, who became one of the automotive industry's most prominent leaders, had been greeted to think about how vehicle manufacturers could share technologies and innovate in a competitive global market. His arrest on Monday stunned the sector and sent the Nissan share price to a two-year low on Tuesday.
French economist Bruno Le Maire, said Tuesday that Ghosn was "no longer able to lead Renault "because of his problems in Japan.
But Mr. Le Maire said that France had no evidence of the crimes that Ghosn has been accused of committing in Japan, and would not call for his removal from the Renault, a French company icon. Renault board members prepared to meet in an emergency on Tuesday.
In a joint statement released on Tuesday afternoon, Le Maire and Hiroshige Seko, the Japanese Minister for Economic Affairs, said they had spoken on the phone and "confirmed the strong support of the French and Japanese governments to the alliance formed between Renault and Nissan. "
Herr. Ghosn was arrested on his private jet at Haneda Airport, which serves Tokyo, after a Nissan whistleblower alleged that he had underestimated compensation to the Japanese government. Another executive, Greg Kelly, as the authorities described as the architect of the scheme, was also arrested.
Neither Mr. Ghosn nor Mr. Kelly could be reached for comments.
After a month-long internal request, Nissan said it was planning to remove Mr. Ghosn from his position as leader when the board meets on Thursday. The Standard & Poor rating center warned that it could downgrade the company over the scandal.
Nissan's profitability could "weaken significantly" in the financial years 2018 and 2019 if it appeared that Mr. Ghosn's alleged neglect had injured the sale or the company's alliance with Renault and Mitsubishi, S & P said in a statement.
Mr. Ghosn introduced sweeping changes at the Nissan start in 1999 and made a work arrangement between Nissan and Renault that allowed them to act as a single automaker. In 2016, the agreement included Mitsubishi, and all three shared the cost of developing models and collaborating with its supply chains. In 2017, the Alliance was in the process of selling 10.6 million cars.
Herr. Ghosn's rapid demise raised questions about the stability of the alliance and individual car manufacturers.
This prospect is particularly worrying in France, where Renault has over 47,000 workers.
Renault has a 43 percent stake in Nissan, and Nissan has a 15 percent share of Renault – the same size as the French government. As one of Japan's best-selling car manufacturers, Nissan's scale and economic performance make it the heavyweight partner in the alliance.
President Emmanuel Macron from France, who faces political challenges at home and casts polls, can not afford to see Renault stumble. He called on Monday for the Alliance to stick together and say that the state would be "extremely vigilant" about its future.
France's influential CFE-CGC union said it was worried about Renault's future and asked that "all measures should be taken to preserve the interests of the Renault Group and the Alliance."
In Japan, Mitsubishi announced that it plan to conduct an internal investigation of whether Mr. Ghosn may also have "engaged in negligence" by underestimating his compensation.
Mr. Le Maire said that the French authorities had not found anything suspicious in Mr. Ghosn's business in that country. "There is nothing special about reporting the tax relationship with Mr. Ghosn in France," he said. But, he added, if the allegations from Nissan in Japan were true, "that would be of considerable gravity."
"Hiding and tax evasion is especially troubled when you have an influential position and a very high salary," he said.
A possible replacement for Mr. Ghosn on Renault may be Thierry Bolloré, chief engineer chief engineer. In an internal memo to employees on Monday, he expressed "full support" to Mr. Ghosn and said that management would defend Renault's corporate interests.
Neither Nissan nor Mitsubishi signaled possible followers. But Standard & Poor's, in the memorandum, said that reconstruction of Nissan's management structure could be a challenge.
"While Nissan said it intends to identify its management issues and hammer out preventive measures, we believe that reconstruction of management culture will not be easy quickly," said the assessment agency.