Nissan, GM to Review Proposal

The chief executive of General Motors Corp. and the head of the Nissan Motor Co.-Renault partnership agreed Friday to cooperate on a joint review of the possible benefits of an “industrial alliance” among the three auto companies.

Their agreement was announced after a dinner meeting in Detroit between Carlos Ghosn, chief executive of Nissan and Renault, and GM’s Rick Wagoner, their first in-person talks since billionaire investor Kirk Kerkorian disclosed his proposal two weeks ago to have GM join the current alliance of Nissan of Japan and Renault of France.

The review will take about 90 days, at which point the companies will decide whether to further explore an alliance, they said in a joint statement.

“We had a good discussion today, and are looking forward to having our teams work together to explore our ideas,” Wagoner and Ghosn said in a statement.

Kerkorian owns a 9.9% stake in GM. He reportedly is impatient with the pace of Wagoner’s turnaround plan for the world’s largest automaker. A spokeswoman for Tracinda Corp., Kerkorian’s Beverly Hills-based investment firm, declined to comment earlier Friday on the meeting.

In interviews this week, Ghosn said he was open to exploring all possible areas of cooperation among the three companies. Such areas could include Nissan sharing plant capacity in North America with GM and the three companies combining parts purchasing to save money.

“Everything is possible because I’m not starting this discussion with preconceived ideas,” Ghosn told Bloomberg News on Thursday. “Every single opportunity is on the table as long as it is driven by the bottom line.”

Ghosn stressed, however, that he was not interested in pursuing an alliance unless Wagoner and GM wanted one.

“If you don’t want to do it, let’s not waste our time,” he said.

Ghosn said he offered to meet Wagoner on Friday because he was already scheduled to visit the Nissan Technical Center in the Detroit suburb of Farmington Hills to discuss product plans.

Wagoner is trying to turn GM around after it lost $10.6 billion last year and saw its share of the U.S. car market slide to 24%, its lowest point in 80 years.

His plan includes shuttering a dozen North American manufacturing facilities and cutting 30,000 jobs in the United States by 2012.

After the GM board gave the go-ahead July 7 for talks with Nissan and Renault, Wagoner was noncommittal, saying he would enter the talks “with an open mind” but cautioning that any potential relationship would be complex.

The GM chief delivered much the same message this week, saying, “It would be helpful to sit down and understand Renault-Nissan’s vision. Both parties need to sit down and see what the key elements are.”

Many analysts have downplayed the chances that the discussions with Nissan and Renault will result in a radical reordering of GM’s business. And whatever is decided will probably take months to iron out.

However, George Magliano, head of the automotive group at consulting firm Global Insight, said both sides had to take the talks seriously.

“There’s too much invested in this for them to just walk away and say, ‘Let’s go back to business as usual,’ ” he said. That all changed June 30, he said, with Kerkorian’s proposal.

One option apparently not on the table is whether Ghosn would run GM as part of a tripartite alliance. He told business news channel CNBC on Thursday that he wouldn’t “run any other third company, and that’s not what’s at stake here.”

The Associated Press was used in compiling this report.