Top > Business > 2006 > July > 2006-07-05

Nissan and Renault Consider GM

A major U.S. auto manufacturer has got a contender or ?deux? for its affections?or rather, its business. Nissan Motor Corp. of Japan is looking to team up with General Motors, along with French automaker Renault as well. If such a deal were to go through, both Nissan and Renault would likely acquire 10% each of GM stock. General Motors, it must be said, is the world?s largest automaker. However, in an effort to restore profitability to the company, GM is letting workers go and shutting down factories.

The governing boards of both Nissan and Renault approved the opening of talks with GM at their meetings on Monday. Nissan itself had profitability issues before Carlos Ghosn came in and turned things around. Some analysts have said that should an alliance with GM and Renault come through, Ghosn could help General Motors leap back towards a more than profitable outlook again. All of the ?Big Three? U.S. automakers, based out of Detroit, have had issues in recent years concerning their profits.

Carlos Ghosn is the chief executive of both Renault and Nissan. In 2005, GM paid Italian automaker Fiat $2 billion to break an alliance with that company as its shares and value plummeted. 35,000 workers of GM had agreed to retired early recently, and has plans to close 12 plants making GM lines by 2008.