Car industry gloom even descends on Carlos Ghosn

[Stéphane Dumas]

an article from the Financial Times then I spotted at
http://www.ft.com/cms/s/0/33dc411a-4...nclick_check=1

Car industry gloom even descends on Carlos Ghosn
By Paul Betts

Published: July 9 2008 03:00 | Last updated: July 9 2008 03:00

Carlos Ghosn has always enjoyed driving himself hard. When the celebrity car manager took over at Renault, he set himself the challenge of reviving the French car manufacturer within three years with a rash of new models and more efficient working practices.

The idea was to repeat in France his success at turning round Nissan - Renault's Japanese affiliate. Everybody had high expectations and investors were delighted.

Now less than 12 months away from his target date for Renault's revival, Mr Ghosn seems to be uncharacteristically pessimistic. Just days ago, he was warning of awful times ahead for carmakers. Investors still seemed to underestimate the extent of the downturn in the US and things were likely to become ugly in Europe in the autumn.

The French car market so far has shown remarkable resilience, largely as a result of government incentives to buy cheaper, cleaner cars. This is a sector where Renault and its French rival, Peugeot-Citroën, are strong. Nonetheless, high oil prices, rising inflation and morose consumers will eventually take their toll on new car sales.

Mr Ghosn has been in tough times before. Not so long ago, he even considered a tie-up with General Motors in the US in the hope of replicating the success of Renault's link with Nissan. But GM is on the ropes and is hardly the right partner, at this stage at least, to help create a new global champion.

The Renault and Nissan boss is not alone in feeling the heat. Sergio Marchionne, the Fiat chief executive, who has done such a good job reviving the Italian car company's fortunes, has been making similar worried noises in recent months. Yesterday, it was the turn of Peugeot-Citroën to forecast a decline in European car sales this year because of the worsening economic climate. Overall, the company is sticking to its global sales growth targets of about 5 per cent for this year but analysts are not convinced, sending Peugeot-Citroën shares to a nine-year low at one stage yesterday. Renault shares fell even more sharply, signalling the market's growing concerns.

Yet it is unusual for someone as ebullient as Mr Ghosn to sound so gloomy. It is fair to say that, since he set his target to achieve Renault profit margins of 6 per cent by February 2009, the world has changed. Who would have predicted oil prices at above $140 a barrel, let alone the explosion in food prices? So perhaps Mr Ghosn is simply reflecting his preoccupation with the the market. His targets for Renault always seemed ambitious. Getting there is going to be even harder now, and who would blame him for trying to inject an element of cautious realism to market expectations. Even he cannot perform miracles.

[PAULSTS1]

Carlos Ghosn is doing what is expected of a CEO, in charge of creating a return on investor's money, he's telling the Truth! Is that what's happening at GM with Wagoner and Lutz, 7734 no! They are giving the same tired Company line right up to the time the Company must file for Chapter 11 protection. If truth had been expressed 24-36 months ago, perhaps emergency corrections would have created enough adjustments, that the company would be in better condition than it is today.

There is more that needs to be said: The Economic Issues are worldwide, and all companies will face these issues to a degree. It's how well a CEO can communicate and whip his team into action, that can either make or break the company. This is why I still say that GM should fire it's CEO and replace him with someone with a great deal more vision and hunger.

[AMERICA 123]

Infiniti, Acura, and Lexus are not positioned for what's coming.

That's part of it - and the extra special yen subsidy profits are being gutted by energy costs -with no mony to make in the JDM.

GM is dominating Russia, now one of the largest and fastest growing major markets on the planet - having just outgrossed all brands combined excluding HYUNDIA for the first 6 months of 2008.

The two companies situations couldn't be more different.

Hyundia/Kia always hurts the Japanese more than GM IN NA - they just outsold Nissan here and Nissan And Honda on a worldwide YTD total and actually outperformed Honda for JUNE in NA.

All his plans are readjusting - like everybody else.

[Stéphane Dumas]

Originally Posted by AMERICA 123

Infiniti, Acura, and Lexus are not positioned for what's coming.

That's part of it - and the extra special yen subsidy profits are being gutted -with no mony to make in the JDM.

GM is dominating Russia, now one of the largest and fastest growing major markets on the planet - having just outgrossed all brands combined excluding HYUNDIA for the first 6 months of 2008.

The two companies situations couldn't be more different.

Hyundia/Kia always hurts the Japanese more than GM IN NA - they just outsold Nissan here and Nissan And Honda on a worldwide YTD total and actually outperformed Honda for JUNE in NA.

All his plans are readjusting - like everybody else.

for the dominance of GM in Russia, I wonder if it might be linked with the 5% of GM then the Russian billionnaire Oleg Deripaska currently own?

Also I started another thread about an article of Ghosn who mentionned a possible car consolidation coming
Renault chief expects car industry consolidation

[AMERICA 123]

All good questions x3.

The 'financial' volume performance by GM in Russia is unreal - where the heck is everybody else besides HYUNDAI ?