RIO DE JANEIRO, BRAZIL – Until the episode of his arrest in Japan and his flight to Lebanon, Carlos Ghosn didn’t have to worry about his reputation. He was a strong name, if not the strongest, in the world auto industry.
The son of Lebanese immigrants born in Porto Velho, in Brazil’s Rondônia state, the executive is now far removed from the industry that brought him to fame. Despite concentrating all his efforts to prove his innocence, he still speaks with ownership of the industry that gave him notoriety.
According to Ghosn, as much as the pandemic has had a large effect on business, there is no disruption in the automotive sector. However, the crisis tends to separate the best-managed companies from the others. Even in Brazil, where the sector has been suffering more, and several factories closed, he sees this happening.
All this will come at a price, however: some companies will fall by the wayside, and Ghosn’s predictions affect precisely the companies that he presided over. “The weakest will leave Brazil, which always happens in big crises. Among the weakest, I cite the Alliance (Nissan-Renault),” he said in an interview with VEJA from Beirut, Lebanon. Ghosn and his wife, Carole, have just released the book ‘Together, always’ by publisher Intrínseca.
Q – How do you see the effects of Covid-19 on the automotive sector? Will the consequences diminish the importance of the industry?
A – The impact of Covid-19 on the automotive industry was terrible, as it was on other activities. Now, the 2020 results showed that some automakers did well. Toyota and Volkswagen, for example, did well, while other companies that were already weak before the crisis fell much further, such as the Alliance itself (Nissan-Renault).
I believe that the Covid-19 pandemic will manage to distinguish between the well-productive, organized, forward-thinking, technology-savvy companies and the rest, which will be left well behind. I don’t think it will significantly impact the automobile market’s size because, little by little, mobility should return.
Some people may wonder whether they will travel and stay in hotels, but they are certainly not going to stop using cars, which are independent mobility. The market will come back strongly. With mass vaccination, perhaps in 2022, the sector will slowly return to normality and a reality transformed by technology. The segment that most resisted the crisis was that of electric cars. That is, the technological transformation of automobiles will accelerate after the pandemic.
Q – In the case of Brazil, we had Ford leaving the country. The global supply crisis and the intensification of the pandemic made factories close again. Looking at this scenario, do you see a loss of Brazil’s importance in the global automobile market?
A – The weak and poorly organized players in the automotive sector will leave at the first opportunity. This should open more space for stronger and better-organized assemblers. I am not worried about the industry recovering because it will come back.
But now the number of competitors will certainly decrease. The weakest will leave Brazil, which always happens in big crises. Among the weakest, I cite the Alliance (between Nissan and Renault) because to compete in Brazil, you need a strong automaker with the will to overcome the specific cycles of the local economy, and if the company does not have this will, it will constantly be leaving and entering the country, firing and hiring, stopping and returning. This stop and go is awful for the brand and the employees.
Q – Do you still have family living in Brazil?
A – Yes, I have my mother, who lives in Rio de Janeiro, two sisters, and other relatives. They are suffering because they were not used to the total closure of the economy. While we, who have already lived in Lebanon and European countries, were confronted with this confinement a long time ago.
Q – How do you see the course of the pandemic in Brazil?
A – There are two possible answers. The first is that the mass vaccination campaign is happening. The second is that those ‘lifesaving gestures’, such as wearing masks and adopting social distancing between people, were very efficient in other countries.
And now Brazil is imposing these rules more rigorously. I am hopeful that the national crisis, even if acute at this moment, should not take long to pass. Little by little, normality will return, but this may still take some months. This unpleasant time of confinement is necessary to curb the contagion of the disease.
Q – How was the Brazilian government’s relationship during your imprisonment in Japan and the departure to Lebanon?
A – I didn’t have any official position from Brazil. We wanted some support from the government, but we got a neutral position. Yes, some sectors wanted, yes, to help, but others chose neutrality because of Brazil’s relationship with Japan.
In the end, I understand the Brazilian position because I was not heading a large company in the country. I didn’t go to Japan as the head of Petrobras, for example. If I were the president of a big Brazilian company and ended up in jail in Japan, I would expect some government help.
In my specific case, this task would fall to the French government because I went to Japan as president of Renault, loaded with French interests and with the mission to strengthen relations with the Alliance.
Q – Do you have plans to return to Brazil?
A – Yes, certainly. The day I manage to remove the Red Notice from Interpol, which the Japanese asked for, and I am really converting this, I will visit my mother, sisters, and relatives. I will go back to Brazil, because I have many friends there, after all, it is my country of birth. I have always kept very close contact with Brazil, which will certainly be one of my first trips.
Other side
Both Nissan and Renault are not commenting on the Carlos Ghosn case but informed that they are committed to investing in Brazil for the coming years. “We have no plans to leave. We have just launched a new product, manufactured in Resende,” says the Japanese automaker, which recently launched a new version of the Kicks, manufactured in the state of Rio de Janeiro.
Renault says it will launch “five new products by the first half of 2022, including the renewal of vehicles in the current range and a turbo engine, which will be imported. Also, two electric vehicles will be launched in the same period.” According to the company, there has been a recent investment of R$1.1 billion in the country, which “reaffirms the importance of the Brazilian market for the Renault Group.”
Both companies announced temporary plant closures because of the increase in Covid-19 cases in the country. Renault’s plant in São José dos Pinhais (PR) halted activities on March 29 and plans to return on April 5. Nissan stopped the plant in Resende (RJ) and gave collective vacations to its employees between March 26 and April 9.
Source: Veja