Nissan Americas CEO Carlos Tavares - shown here with the Leaf battery car - will become Renault's new COO.
Carlos Tavares, the chief executive of Nissan Americas, will be heading across the Atlantic to serve as the new chief operating officer of the Japanese maker’s French affiliate, Renault.
The new assignment comes as Renault struggles to shake off the scandal that followed the firing of three senior executives falsely accused of spying for the Chinese. That brouhaha led to a shake-up of Renault’s top management, including the ouster of COO Patrick Pelata.
The decision to move Tavares back to France has been widely expected, TheDetroitBureau.com first reporting on it more than six weeks ago. It’s a homecoming of sorts, Tavares having spent 23 years with the French carmaker before being assigned to the U.S. in 2004.
The move comes at a critical time for Renault, which had been struggling to regain traction in the European market – and grow its overseas base, especially in China – even before the espionage scandal. The loss of Pelata threatened to leave a significant void in the carmaker’s senior ranks as the former COO was considered a close confidant and ally to Carlos Ghosn, who serves as chief executive officer for both Renault and Nissan.
In a statement, Ghosn described Taveres’ appointment as “a first step in strengthening Renault’s management.” But his reassignment could be “a significant loss” for Nissan Americas, cautions Deutsche Bank’s Kurt Sanger.
The auto analyst describes Tavares as “an influential player and an effective manager (who was) critical in defining a new strategy for the North American operations and for bringing a new sense of energy.”
The fact that Tavares wasn’t reassigned more immediately underscores the challenges the management shake-up creates. While its two major Japanese rivals have been struggling over the last several years, Nissan has quietly gained ground in many key global markets, especially North and South America. The expansion of its overseas production base, especially in the Americas, has helped Nissan minimize the impact of Japan’s March 11 natural disaster – at least compared to Toyota and Honda.
Meanwhile, Nissan has been moving ahead with the launch of one of its most critical products in years, the high-image Leaf battery-electric vehicles. Leaf, which went on sale last December, is just beginning to see a ramp-up in production, with Nissan preparing to add additional assembly capacity at its plant in Smyrna, Tennessee.
As a result, the Americas operation headed by the Portugese-born Tavares was “expect(ed)…to serve a critical role in boosting profitability” at Nissan in the mid-term, said Sanger.
To keep things running smoothly, the Japanese maker is taking a team approach to replacing the well-respected Tavares.
Taking the lead role will be Colin Dodge, who currently serves as executive vice president, Chief Performance Officer, and Chairman of Nissan’s Africa, Middle East, India and European operations. He will now add Chairman of the Americas to that lengthy list of titles.
Dodge will also get some help managing the new part of his portfolio from Bill Krueger, a one-time Toyota executive who has most recently been in charge of Nissan Americas’ manufacturing, purchasing and supply chain management. Krueger gets the newly-created post of vice chairman.
Considering the extensive duties, it remains to be seen whether the new org chart structure will remain for long, or whether Krueger, who joined Nissan in 2005, will be moved up if he can prove himself in his new role.
The game of musical chairs shaking up the Renault-Nissan alliance was triggered by a spy scandal that was itself touched off the firing of three top French executives early this year. An anonymous tip had indicated they were providing information on Renault’s ambitious electric vehicle program to the Chinese.
Initially supported by an internal corporate investigation, the matter blew up on Renault when French government investigators traced the matter back to the company’s own security department, charging several members with trying to shake down the company. The three ousted managers have since been giving apologies – and substantial cash awards.
Palata, who had taken a high-profile position during the espionage investigation, stepped down from his COO post, some believe, to spare Ghosn who was, nonetheless, sorely embarrassed by the scandal.