Carlos Ghosn: ‘car makers becoming mobility providers’
In an interview Carlos Ghosn, CEO of the Alliance Renault/Nissan/Mitsubishi, foresees car manufacturers becoming more and more mobility providers and an almost disappearance of the diesel engine.
The boss of the largest car manufacturing group in the world is fairly confident about the future: this year he wants to sell some 11 million cars and at the same time stay the number one in electric mobility, despite of the quickly growing competition…
What’s your vision on the evolution of the last two years?
“The biggest change was the coming of the connected and (semi-)autonomous car and the development of mobility services. The manufacturers have reacted to that by trying to get deeply involved, mostly by allying themselves to partners knowledgeable in the field. An example: look at what is being proposed and developed now in Paris, after the auto-lib decline. You will see the same things happening in all the cities of the world.”
Is operating mobility services really a task for a car industry CEO?
“That’s our challenge for the next 10 years: reach our ambitions and those of our customers without losing money. There has to be an equilibrium between sales and profitability. Within the Alliance, we now have a solid plan for the connected, autonomous car or the robotaxi. Two years ago, we were talking about a few prototypes or concepts, today we have a structured plan and we are ahead of the competition.”
Are you still a leader concerning electrification?
“Of course. When you hear all declarations of the competition, you’re not sure who’s in front and who’s behind. But you have to look at the market: just count the number of electric cars and who has produced them. With Zoë, Leaf and others we are in front in numbers and profitability. Kangoo ZE is number one in Europe for commercial vehicles, and with K-ZE we will conquer China next year, as we will do with other products in other regions. Everything is open, but today it’s the Alliance which occupies the terrain.”
The Germans are investing and declaring a lot…
“You hear a lot of big announcements and promises. But going from 5.000 EVs to 1 million in a few years would be phenomenal. The one who can achieve that has my utmost admiration. At the end of 2022, half of the Alliance offer will be electrified and in 4 years we will sell 10% of our total sales as purely electric vehicles. What we won’t do, however, is selling and losing money.”
Won’t an electric car remain more expensive than others?
At a certain moment prices will turn around. It depends on incentives in countries and more importantly of the reduction of costs in the industry (technical innovation and growing volumes). At the end of 2022, our EV range has to have the same profitability as the average car in the group.”
You seem to turn to hybrid too. For a long time you didn’t believe in it…
“We stay focused on purely electric, that’s the ultimate technology for us, but if the market has a strong demand for hybrid or plug-in hybrid, we will provide it. It is not our aim, though, to become a market leader in those technologies.”
Will you be able to obtain CO2 objectives without a big part of diesel engines?
“The diesel decline is going even faster than expected. We have to revise our expectations practically every three months. Consumers are not stupid: they sense that the diesel is not popular anymore, especially not politically, so they look for something else, except for bigger commercial vehicles or in large sedans. The diesel decline will continue in the long term. Maybe this is not totally justified, but a market is not entirely objective either… We decided to half our diesel portfolio before 2022, I fear that we will have to act even more quickly. If we sell enough EVs we will obtain our CO2 targets but that also depends of incentives being kept or even enlarged.”
Donald Trump seems to have launched a commercial guerilla…
“That’s really a big change. We were on a straight line toward open borders, now we are reversing. We will have to produce locally again, globalization is in danger, but you also see that in the end trade pacts can be realized and we try not to be too dependent on countries that could get involved in real trade wars.”
Is there a trend to more consolidation in the whole car business?
“That’s for sure. Size isn’t everything but it does play a role when you’re looking to cut costs or heighten profit margins. Our Alliance, however, will not take first steps in this matter. A general manufacturer which produces 3 million cars or something has one obsession: becoming bigger. When you make 11 million cars every year this is not a priority, but if there’s an opportunity, like we had with Mitsubishi, why not?”
You just signed a co-operation with Google, integrating the Android system in all your cars. Isn’t that inviting the wolf in the sheepfold?
“With this agreement we don’t abandon the sovereignty of our cars, we just respond to a consumer demand with something that fits our technical demands. Google knows that it wouldn’t be allowed in our cars if it would menace our technical integrity or the personality of our cars.”