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Last Updated: Monday, 3 July 2006, 09:56 GMT 10:56 UK
Car bosses discuss alliance plan
Carlos Ghosn
Mr Ghosn has the nickname of "Le cost killer"
Carmakers Nissan and Renault are to hold board meetings to consider plans for extending their tie-up to include struggling US rival General Motors.

Renault bosses are meeting on Monday, while Nissan chiefs will meet "soon" to discuss proposals put forward by Kirk Kerkorian, who has a 10% stake in GM.

Mr Kerkorian wrote to GM last week, urging it to join the alliance.

Renault and Nissan have an equity stake in each other, and co-ordinate their strategies and product development.

Market reaction

GM has already said it will consider Mr Kerkorian's suggestions.

According to a report from the Reuters news agency, Carlos Ghosn, the chief executive of both Nissan and Renault, expressed an interest in acquiring a stake of up to 20% in GM at a dinner with Mr Kerkorian last week.

Mr Ghosn has often said that the seven-year-old alliance between Renault and Nissan could be expanded, although this would not have to include an equity partnership.

Renault has a 44% stake in Nissan, which in turn owns 15% of the French carmaker.

Mr Ghosn is credited with rescuing Nissan from major financial difficulties in 1999, and recently announced a major revival strategy for Renault, which runs through to 2009.

Some analysts have suggested that taking on the additional troubles of GM, which made a $10.6bn (5.7bn) loss in 2005, would stretch his talents too thinly.

On Monday Nissan shares closed 0.6% higher, but Renault shares were one of the main fallers on the French markets, down 1.1% after early morning trading.

News of the potential alliance had sent GM shares nearly 9% higher on the New York Stock Exchange on Friday.




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