The head of the Renault-Nissan automaker group yesterday warned that the worst of the global financial crisis was yet to come, saying it could last into 2010.
Carlos Ghosn, the legendary manager who turned Nissan around a decade ago, said the auto industry was being pummeled by deteriorating markets in the rich world as well as a slowdown in emerging markets such as Russia and China.
“We have not seen yet the worst,” Ghosn told a business forum in Tokyo.
“Even if the financial crisis stops, the consequences of the market slowdown in terms of unemployment [will] come. So far we have seen only the beginning of the consequences,” he said.
Ghosn said he was bracing for “a relatively long term of credit turbulence.”
“This is going to probably lead to a situation in 2009 which [will be] at best lukewarm. It may continue into 2010 if the financial meltdown does not find good solutions to address it,” he said.
“I think we are in the unchartered water,” he said.
Japan’s Nissan, in which France’s Renault holds a controlling stake, is cutting production of luxury cars for export to the US and eliminating 1,680 jobs in Spain in response to falling demand.
Renault is closing nearly all of its plants in France for at least one week and has cut its operating margin target for this year.
In a time of severe crisis, Ghosn said, firms should focus on short-term goals, namely, keeping their finances sound.
“Short-term issues have to be treated. That is very, very serious. Today, short-term is about managing cash,” Ghosn said.
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