01/07/2006
NEWS STORY
Billionaire, Kirk Kerkorian, who owns a 10% share in General Motors (GM), is urging the company to consider a partnership with Renault-Nissan, which, if it were to happen, would create a 'super manufacturer', such would be the size and power of the company.
Mr Kerkorian's investment firm Tracinda is the third largest shareholder in GM and is understood to have written to both Rick Wagoner, head of GM, and Carlos Ghosn, head of Nissan and Renault, urging them to consider a partnership.
"It is our understanding that Renault and Nissan are receptive to the concept of including General Motors in their partnership-alliance and purchasing from General Motors a significant minority stake in the company," wrote Kerkorian.
"The Renault-Nissan partnership has created tremendous engineering, manufacturing and marketing synergies, resulting in substantial benefits and costs savings to both firms," he added.
Subsequently, Renault-Nissan issued a statement which read: "At this point it is necessary that GM boards and top management fully support this project in order to start the study of this opportunity after agreement of Renault and Nissan boards."
Mr Kerkorian's suggestion comes at a time when GM is facing fierce competition from other, particularly Asian, manufacturers, with losses in 2005 estimated at $10.6bn.
Meanwhile, Carlos Ghosn, has performed miracles since taking control of Nissan in 1999, taking the company from debt into profit by 2001. Renault has 44% share in Nissan, which in turn has a 15% share in the French company.
Incidentally, Pitpass is hearing rumours that the 'Nissan' name will be seen on the grid next season, what chance Renault-Nissans or Red Bull-Nissans?