“My experience would be good for any car company. Why not GM? I would be honoured to lead a company like GM”
Renault fired Chief Operating Officer Carlos Tavares after he expressed an ambition to lead Ford or General Motors, and investors see this as a big loss for the company.
Tavares had headed up Renault affiliate Nissan’s U.S. operation and helped turned huge losses into a $2.2 billion profit in 2010. Tavares also presided over Renault’s surprise performance in Europe in 2013. Renault’s automotive division saw sales slip by 0.9 per cent to €20.4 billion in the first half of 2013, but its operating margin rose to 2.9 per cent from 2.5 per cent, despite Europe’s weak markets. This was due in no small part to the success of its cost-cutting programme and inroads by its cut-price Dacia subsidiary. Some analysts though thought the quality of the results were tainted by burgeoning stocks of cars building up at dealerships.
Deutsche Bank said Tavares’ ouster didn’t bode well for Renault.
“His departure is bad news since he had a good track record and was very focused and disciplined on free cash flow generation. And he has succeeded in reducing the pricing gap with peer group. Today we do not see any obvious internal candidate to replace him. Overall, this is clearly negative news,” Deutsche Bank analyst Gaetan Toulemonde said.
Renault didn’t announce any immediate plans to replace Tavares.
In an interview with Bloomberg, Tavares said current CEO Carlos Ghosn wasn’t likely to quit any time soon, and he would be too old (he is now 55) by the time Ghosn did. Tavares told Bloomberg he was interest in running GM or by implication, Ford.
“My experience would be good for any car company. Why not GM? I would be honoured to lead a company like GM,” Bloomberg quoted Tavares as saying, after he earlier said his best chance to run a car manufacturer was in the U.S.
GM and Ford quickly denied Tavares was about to join either of them.