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Monday, April 11, 2011

Renault COO Pelata resigns over spy case [video]

Renault SA accepted Patrick Pelata's resignation as chief operating officer over a botched espionage investigation that led to the wrongful dismissal of three senior managers.

Pelata, 55, who was Ghosn's right-hand man, will stay on temporarily pending a reorganization of the automaker's executive committee before moving to a role within the carmaker's alliance with Nissan Motor Co., the French carmaker said today.

Renault's board of directors also agreed at an emergency meeting on the departure of Laurence Dors, the company's general secretary, human resources manager Jean-Yves Coudriou, legal director Christian Husson and director of security Remi Pagnie.

Renault admitted last month it was hoaxed into wrongfully firing upstream development chief Michel Balthazard and two other executives after a company investigation incorrectly concluded they had received payments from Chinese companies via foreign accounts.

Renault security manager Dominique Gevrey, who had obtained more than 300,000 euros ($434,000) from the carmaker to pay an anonymous source for the information, was arrested on fraud charges after the espionage claims unraveled.

Renault fired the three executives in January on suspicion of industrial espionage, all of whom denied wrongdoing from the start. Renault last month apologized to the three falsely accused executives and offered to reinstate or compensate them.

Pelata offered his resignation at that time of the apology, but Renault CEO Carlos Ghosn refused to accept it, saying he did not want to add one crisis to another. Instead, Ghosn and Pelata pledged to forgo their 2010 bonuses and profits from 2011 stock options.

Earlier on Monday a Renault spokesman said a report by French TV channel iTele that Pelata's resignation had been accepted at a special board meeting on Monday was not correct.

Morgan Stanley analyst Stuart Pearson said Pelata's departure was a loss to Renault, although investors would not be surprised, and the fact that Carlos Ghosn was staying on as CEO would limit the impact on shares.

"Pelata as COO did a solid job of guiding Renault through the last few years," Pearson said, adding that his departure could hamper the new strategic plan Renault unveiled in February. "It does call into question the execution of the strategic plan that has only just been announced - Pelata would have been a key architect of that. It's not immediately obvious who could replace him."

Audit shows 'serious dysfunctions'

French Industry Minister Eric Besson said an external audit on the industrial espionage affair reveals "serious dysfunctions within the company's management."

Besson would not identify those responsible for the dysfunctions, adding that they were named in the audit report.

After the collapse of the espionage case, Ghosn was criticized by ministers of the French government, which owns 15 percent of the automaker, but the government later eased pressure on the CEO, saying it was important to have stability at the top of the company.

Last month, Ghosn said he had refused to accept the resignation of Pelata over the "sorry episode," as he "did not want to add one crisis to another."

Pelata helped Nissan rescue

Pelata graduated from France's elite Ecole Polytechnique in the same 1974 class as Ghosn, before joining Renault as head of bodywork assembly at the carmaker's plant in Flins, west of Paris.

In 1999, when Ghosn was sent by then-CEO Louis Schweitzer to rescue Japanese affiliate Nissan Motor Co. from near-bankruptcy, he took Pelata with him and the two have worked closely together ever since. Pelata took over day-to-day control at Renault from Ghosn in 2008.

Ghosn and Pelata are close allies but have different styles. Pelata, with his sharp suits and rectangular-framed glasses, is soft spoken, while Ghosn's oratorical style shows he relishes the reputation as a car industry guru that he earned by transforming Nissan from a money-loser into a success story.

Renault and Nissan aim to become the leader in electric cars and from 2015 the alliance will have a global EV production of 500,000 units. Renault is due to launch two EVs, the Fluence sedan and Kangoo small van, in the second half of this year. The Zoe subcompact and the two-seat Twizy are due to follow in 2012.

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