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Ghosn is out of jail but the hard slog begins now

Murali Gopalan | Updated on March 07, 2019 Published on March 07, 2019

Carlos Ghosn   -  Bloomberg

The former chief of Renault-Nissan has his work cut out in proving his innocence

Carlos Ghosn could not have asked for a better birthday gift.

The former CEO of Renault and Nissan turns 65 on Saturday and nothing could be sweeter than freedom from solitary confinement of over 100 days. The world was stunned with the news of his November arrest, and the fact that he was deemed guilty without getting a chance to prove his innocence only brought Japan’s ‘hostage justice’ system under severe scrutiny.

Ghosn will, of course, need to prepare for the bigger battle ahead with zealous prosectors keen to prove that he indulged in large scale financial fraud. If they succeed, he will be put behind bars for 15 years but if they don’t, then there could be a lot of drama ahead.

Ghosn has constantly maintained his innocence and will be keen to set the record straight. Either way, it will do little to undo the damage that has already been caused. Assuming that he walks away a free man, he is not going to be able to recapture the sheen that has now been lost forever.

At best, there will be words of sympathy for a man who once ruled the roost like a Colossus but that would be pretty much it. After all, reports of his extravagant Versailles wedding are not going to be forgotten in a hurry.

There is now a new hierarchy structure in place at Renault and it is also clear that Nissan is not going to take things lying down any longer. The Japanese auto-maker is only too aware that it is the stronger of the two in the alliance even while its French partner has a larger stake with voting rights to boot.

Ghosn was an overwhelming presence who perhaps made the cardinal mistake of contemplating a merger between the two entities. By now, it is only too well known that Nissan resented any such move and speculation is rife that the man who played a big role in its rehabilitation 20 years ago ended up being the patsy in a messy sequence of events.

Ghosn has a strong and aggressive legal team right now but it is not going to be easy taking on the might of a system where the prosectors have a better track record. Nissan will be determined to prove the charges against him and it will be a long-drawn process where there will be no winners by the end of the day. If Ghosn goes down, he will ensure that there are a whole lot of others who will sink with him.

There are also no two ways about the fact that things will never be the same between Renault and Nissan. The coup against Ghosn was carried out stealthily with the French partner completely in the dark. His loyalists will still be smarting about what happened and trust once lost will be difficult to make up.

Yet, the alliance will continue for reasons of survival. The world automobile market is facing a host of challenges and it is only partnerships like Renault-Nissan (along with Mitsubishi) that can hope to weather the onslaught. Till Ghosn was around, there was a clear cut strategy in place, especially on the issue of synergies. How the new leadership steers the ship forward is the million dollar question.

How has the scandal affected Ghosn? His carefully cultivated public image has taken a beating for sure but it is remarkable that he did not yield to the constant barrage of interrogations in jail. Now that he is out, albeit with severe restrictions, he will be keen to set the record straight.

For now, Ghosn will be relieved that he is out of hell and can at least celebrate his homecoming on Saturday with his family. Life in jail is harsh and there is really nothing as welcome as freedom.

For someone who was considered a top class strategist, Ghosn faces his biggest challenge yet.

Published on March 07, 2019
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