Nissan gets controlling stake in Mitsubishi; Ghosn chairman

Nissan has officially completed the process of taking over a controlling stake in Mitsubishi, which has adversely been hit by the infamous fuel economy scandal. With Mitsubishi joining the Renault-Nissan alliance, the resultant group is now the third largest automotive manufacturer in the world, behind Toyota and Volkswagen.

The deal, valued at $2.3 billion, formally gives a 34% controlling stake in Mitsubishi to Nissan. The new alliance is expected to help both automakers in using each other's technologies. Moreover, Mitsubishi will hope to regain customer confidence, which was lost earlier this year after the company admitted that it had been claiming false fuel economy figures of its small cars, especially in the US markets.

Mitsubishi had reported a profit in 2015, but is now expecting an annual fiscal loss of around $2 billion at the end of this year. This would be the company's first annual loss in eight years. With the new partnership, the company will hope to survive this setback.

Nissan-Renault's current CEO, Carlos Ghosn will be taking over as Chairman of Mitsubishi. In order to give more of his attention towards repairing Mitsubishi's condition, Ghosn has appointed Hiroto Saikawa as the co-CEO of Nissan and Renault. Saikawa is also the Chief Competitive Officer of the Renault-Nissan Alliance.

Source: Wall Street Journal