Renault-Nissan Without Ghosn Were Worst Car Stocks of 2019

(Bloomberg) -- Carlos Ghosn’s jaw-dropping getaway added insult to an injurious year for the automakers he used to run: Renault SA and Nissan Motor Co.

The two were the worst-performing carmakers on the Bloomberg World Auto Manufacturers Index in 2019, falling 23% and 28%, respectively. Ferrari NV, Kia Motors Corp. and Tesla Inc. logged some of the biggest gains.

Ghosn, 65, fled Japan and took refuge in Lebanon, just over a year after his shocking arrest in Tokyo roiled the two companies and strained ties between them. His escape also cast a cloud on the relationship between France and Japan at a moment when the countries are trying to help two of their largest employers shore up a two-decade-long alliance.

While Nissan dismissed its longtime leader in November 2018, Japan’s third-largest carmaker by output is still reeling from the fallout. Last week, its No. 3 executive said he’ll join another company. It was the latest in a string of departures that included Hiroto Saikawa, Ghosn’s successor-turned-accuser, who stepped down as CEO last year amid a scandal over excess compensation.

The exodus has exacerbated the challenge of navigating an industry downturn that’s driven Nissan’s profits to the lowest in a decade and prompted Renault, which ousted its CEO in 2019, to slash its financial guidance in October.

Established carmakers are seeking scale through consolidation as a way of splitting the billions of dollars in investments needed to keep up with the shift toward electric and self-driving cars. Yet Renault and Nissan have been drifting apart since Ghosn’s fall. The consequences of those tensions were on full display last year when resistance from Nissan torpedoed a plan for Renault to merge with Fiat Chrysler Automobiles NV. Fiat has since agreed to combine with Renault’s French rival Peugeot SA.

Mitsubishi Motors Corp., the third partner in the Renault-Nissan alliance, hasn’t fared much better. It’s stock tumbled 24% in 2019, with analysts calling for profits to tumble 75% in the fiscal year ending in March.

©2020 Bloomberg L.P.