Final answer:
The Renault Nissan alliance is facing challenges due to the arrest of Carlos Ghosn on financial misconduct charges, which led to leadership vacuum and exposed cultural clashes and trust issues between the two companies. Additional financial challenges were brought on by the global pandemic, further stressing the alliance.
Step-by-step explanation:
The Renault Nissan alliance is in trouble due to a combination of leadership issues, cultural clashes, and financial challenges. The arrest of Carlos Ghosn, key architect of the alliance, on charges of financial misconduct in November 2018 was a significant trigger for the current troubles. Ghosn's downfall created a vacuum in leadership and exposed underlying tensions between the two companies, affecting trust and collaboration.
Another aspect contributing to the alliance's difficulties includes differences in business culture and governance between the French and Japanese sides of the alliance. These challenges were exacerbated by the financial losses incurred during the global pandemic, which intensified the need for cost-cutting and restructuring. The alliance, which was intended to leverage synergies and boost competitiveness, has instead been struggling with aligning strategies and managing joint operations.
The future of the Renault Nissan alliance remains uncertain as the partners attempt to navigate through these complex issues while trying to maintain competitiveness in an increasingly demanding and transformative automotive industry.