Happy New Year.
With 2020 vision, a few people might have made some different choices over the last couple of years. Perhaps investors would not have been so keen to plough into Aston Martins IPO back in 2018. And perhaps shareholders would have bailed out at the start of last year had they known that shares would plummet by around 80%. It certainly has not been helped by a profit warning this week.
There are some potential glimmers of hope on the horizon, however, with the long awaited DBX about to launch in the early part of this year, and reports that Geely, the Chinese car company that owns Volvo and Lotus, as well as quite a sizeable chunk of Daimler, is reported to be interested in buying a stake in the company and providing much needed finance.
And perhaps Carlos Ghosn might have done things differently. So he did not have to be smuggled out of Japan in a music crate. No doubt his escape will be written about for many years, and his holidays to Japan will not be as frequent as before.
But his appearance in Lebanon was a real surprise to everyone. And it is what this has done to the relationship between Renault and Nissan that is much more relevant to our industry. Because the analysts reckon that any tie-up is pretty dead in the water. Arndt Ellinghorst, one of the leading analysts in the City, has written a report this week on precisely why this relationship went sour. He dates it back to when the French government took an extra slice of Renault and effectively blocked Nissan’s influence on the Renault board, while leaving Renault with a big influence on Nissan. He cannot see the alliance being salvaged unless the French side sell down some of their shareholdings so both parties return much more to equal participants. And he does not think this will happen.
But he does think that the subsequent revelations from Mr Ghosn will also be quite damaging, as they will probably highlight mistakes, mistrust and open animosity in the relationship. Whatever the outcome, Renault almost certainly needs a global partner of some sort, and at the moment there are not many choices out there.
On a brighter note, many of my clients are reporting that, despite this being early days, the market looks a little more buoyant this year than it did last. Whether this is the Boris effect, the relief of getting an election out of the way, or just leaving behind a particularly disappointing decade, only time will tell. But there are some green shoots out there.
Have a great weekend, only 343 shopping days till Christmas.
The man who says he is willing to meet you halfway is usually a poor judge of distance.
Laurence J. Peter (1919 – 1988)
The trouble with being poor is that it takes up all of your time.
Willem de Kooning (1904 – )
Take care of the luxuries and the necessities will take care of themselves.
Dorothy Parker (1893 – 1967)
We confess our little faults to persuade people that we have no large ones.
Francois de La Rochefoucauld (1613 – 1680)
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