Renault-Nissan has a presence in the US market through Nissan, but it’s a small one.  The company has been looking for a partner in the US for some time now, they’ve proposed alliances with GM in the past.  Now, at a time when Cerberus seems like it wants to get out of the car business and has been pushing for a GM/Chrysler buyout/merger Renault-Nissan is proposing to buy 20% of Chrysler.

The two companies are already partnering on vehicles.  Nissan will make a small car for Chrysler and in return Chrysler makes the Nissan Titan and provides Nissan with Heavy Duty trucks as well.

It’s believed that Cerberus would prefer a GM/Chrysler buyout, but so far that deal seems to be halted without any avenue to get financing for the deal.  GM would need to raise a lot of cash to buyout Chrysler workers, and they can’t find a bank willing to lend it to them.

Carlos Ghosn, CEO of both Renault and Nissan has publicly denied any kind of merger as recently as July, but things have changed a lot since then.  He also states that he’s against buying up companies.

“I think that when people talk about consolidation, they imagine company A buying company B. We know this does not work,” Ghosn said at a grand opening celebration of the company’s new North American headquarters in Nashville, Tenn. “Company A buying company B is guaranteed destruction of value after a while.”

And so far he’s practiced what he preached.  Renault owns a 44% stake in Nissan and Nissan owns a 15% stake in Renault.  With both companies sharing many parts under the hood to reduce costs but otherwise remain autonomous of each other.  The only link other than the parts sharing is Ghosn himself, as he’s the CEO of both companies.

Source: Detroit Free Press

While I would prefer Chrysler remain independent I would also concede that Renault is wildly preferable as a buyer of Chrysler than GM.  Renault would keep Chrysler intact while GM would burn it to the ground keeping only bits and pieces.