an article from the Financial Times then I spotted at
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.