Renault COO Patrick Pelata resigns.
Renault’s second-in-command is stepping down, as are four other senior executives implicated in a spy scandal that has shaken up the French automaker – but CEO Carlos Ghosn has apparently been spared in a purge ordered by the maker’s largest shareholder, the French government.
Patrick Pelata will leave his post as Renault’s chief operating officer, though take on a more modest role with the Renault-Nissan Alliance, the maker’s partnership with Japan’s second-largest automaker. CEO Ghosn originally had refused to accept Pelata’s resignation but his second-in-command was forced out after French Finance Minister Christine Lagarde said those responsible for a messy spy scandal “must depart.”
The crisis was kicked off, early this year, when Renault ousted three senior executives involved with its aggressive electric vehicle program. An anonymous source had claimed they were being paid to leak critical information to the Chinese. But, after an investigation by French intelligence, it turned out the three executives were themselves victims of an attempted shakedown by members of Renault’s own security department.
The embarrassing espionage case ultimately unfolded last month with the arrest, at Charles DeGaulle Airport, of security official Dominique Gevrey as he tried to flee to Africa. Under pressure from the government, the Renault board of directors was forced to take action, calling for the departure of Pelata and the other managers.
“The board meeting turned a difficult page in the history of Renault,” Ghosn said afterwards, adding that, along with the three executives improperly implicated in the espionage case, “all the group’s employees have suffered.”
Ghosn himself came under sharp fire for the initial, botched internal investigation. But he escaped the worst of the board’s wrath, a corporate source suggested, because it would have been too risky to oust him as well as Pelata – who will temporarily stay on in the COO role while a search for his replacement gets underway.
His departure could be a difficult one. The 55-year-old executive has been close to Ghosn since they both went to the elite Ecole Polytechnique together, graduating in 1974. Pelata was one of a handful of Renault executives recruited by Ghosn to assist him when, in 1999, he was sent to Japan to help turn around Nissan, then nearing default.
Along with the decision to oust five senior executives, the Renault board reportedly approved hefty payments to the three managers who were falsely accused of spying. Xavier Thouvenin, the lawyer for Michel Balthazard, described it as a “very satisfying settlement.” At least one of the managers is now expected to return to work at Renault.
An investigation into the case revealed “failings and dysfunction within the company,” noted a Renault statement, “particularly in the control and supervision of its security department.”
A criminal investigation into the apparent shakedown will continue.
(For more on the investigation into the alleged spy scandal, Click Here.)