Arrest of Nissan chairman Ghosn roils global auto industry
22 November 2018
The arrest Monday by Japanese authorities of the leader of one of the world’s largest automotive alliances has drawn in the governments of France and Japan and shaken investors.
On Wednesday, a Japanese court extended the detention of Carlos Ghosn for an additional 10 days on charges of financial malfeasance, including hiding tens of millions in income from tax and other government authorities. Ghosn presides over an alliance of Japanese-based Nissan and Mitsubishi and French-based automaker Renault.
Prosecutors allege that Ghosn understated his income by about five billion Yen or $44 million in securities filings and that he used company assets for personal purposes. Authorities also arrested another Nissan executive, Greg Kelly, who they say helped in the scheme.
Under Japanese law suspects can be held for a period of time without the filing of formal charges and questioned by authorities without the benefit of legal counsel, though detainees can meet with attorneys.
Ghosn, who was credited with saving Nissan from bankruptcy, became a celebrity in corporate, media and political circles in Japan and around the world for his ruthless cost cutting. After a stint at Renault, Ghosn was assigned to Nissan where he carried out a restructuring involving the elimination of 21,000 jobs and the closure of five factories. Forbes anointed Ghosn “Businessman of the Year” in 2002 for his work at restoring Nissan to profitability. Later he carried out a similarly brutal restructuring at Renault earning him the appellation “Le Cost Killer.”
Ghosn stepped down as CEO of Nissan last year but remained the company’s chairman. He became CEO of Renault in 2005 and in 2016 he became chairman…