Nissan Motor on Thursday completed a deal to take a controlling stake in Mitsubishi Motors.
Carlos Ghosn, who heads Japan’s Nissan Motor and Renault of France, will become the chairman of Mitsubishi Motors, working to restore faith in the troubled automaker after a devastating mileage scandal.
Japan’s Number 2 automaker has agreed to make a 237 billion yen ($2.29 billion) investment to acquire a 34% stake in Mitsubishi Motors, making it the single-largest shareholder in its smaller peer.
Ghosn, who presided over Nissan's revival from the brink of bankruptcy in the early 2000s after it formed an alliance with Renault, said he expected it would be difficult to restore Mitsubishi's shattered reputation.
“I can tell you we will not spare anything to support Mitsubishi. I think it's possible. It is going to be difficult. It will require tough decisions,” he said.
But the Brazilian-born Frenchman said he believed it was possible. Earlier, Ghosn had described Nissan’s purchase, announced in May, of a 34 percent stake in Mitsubishi Motors Corp. for 237 billion yen ($2.3 billion) as a “bargain.” With the purchase, Nissan has become the biggest shareholder in Mitsubishi, and Mitsubishi becomes a member of the Nissan-Renault alliance.
“We are sending a clear message we believe in the underlying strength of Japanese car making,” Ghosn said.
Nissan agreed to take charge at Mitsubishi after the company acknowledged in April that it cheated to inflate mileage for two of its minicar models, the eK wagon and eK Space, and mini-vehicles it made for Nissan. No overseas models are affected.
(This article has been published in an arrangement with AP and has been cut for length.)
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