Nissan board dismisses Carlos Ghosn

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Carlos Ghosn, the once-revered leader of Nissan Motor, has been dismissed as chairman of the group after a board meeting on Thursday, ushering in a period of uncertainty for its 19-year alliance with Renault.

The Franco-Japanese alliance, enlarged in 2016 to include Japan's Mitsubishi Motors, had been rattled to its core by Ghosn's arrest in Japan on Monday, with the 64-year-old group chairman and industry star accused of financial misconduct.

Ghosn had shaped the alliance and was pushing for a deeper tie-up including potentially a full Renault-Nissan merger at the French government's urging, despite strong reservations at the Japanese firm.

Carlos Ghosn, former chairman and CEO of the Renault-Nissan-Mitsubishi Alliance, attends the Tomorrow In Motion event on the eve of press day at the Paris Auto Show, in Paris, France, October 1, 2018. Picture taken October 1, 2018. /Reuters Photo

Japanese prosecutors said Ghosn and Representative Director Greg Kelly, who has also been arrested, conspired to understate Ghosn's compensation at Nissan over five years from 2010, saying it was about half the actual 10 billion yen (88.47 million U.S. dollars).

Shin Kukimoto, deputy public prosecutor at the Tokyo District Public Prosecutors Office, said on Thursday that court approval was received a day earlier to detain Ghosn for 10 days but he could not comment on whether he had admitted to the allegations.

With Ghosn and Kelly still in detention, neither of the men were able to vote or defend themselves at Thursday's board meeting.

Renault has refrained from firing Ghosn as chairman and CEO, but Mitsubishi Motors plans to remove Ghosn from his post of chairman at a board meeting next week.

Amid growing uncertainty over the future of the alliance, Japan's industry minister and France's finance minister are due to meet in Paris on Thursday to seek ways to stabilize it.

“For me, the future of the alliance is the bigger deal,” said the Nissan official, when asked about Ghosn's arrest. “It's obvious that in this age, we need to do things together. To part would be impossible.”

(With input from Reuters)