Carlos Ghosn is a celebrity in the automobile industry because of his company turnaround stories which almost seem like fairy tales. Carlos Ghosn is currently in the news for fleeing Japan, where he is facing four criminal charges. While he is currently a wanted fugitive, the story of how he made Nissan and Renault forces to be reckoned with is worthwhile.
The Renault and Nissan alliance
When Renault was suffering from chronic underperforming sales and Nissan was nearly bankrupt, Carlos Ghosn proposed an alliance between the two automaker giants, where Renault purchased a 36.8 % stake in Nissan. Carlos Ghosn was later appointed Chief Operating Officer (COO) of both Nissan and Renault. He laid out a three year revival plan for Nissan, which was in a consolidated debt of $ 20 billion. The Nissan revival plan, announced in 1999, promised a return to profitability in the year 2000 and a profit margin over 4.5% in the year 2002 along with a reduction in 50 % of the debt by 2002.
Carlos Ghosn also promised to resign from his position if his goals were not met. Once the plan was announced, Ghosn announced major changes at Nissan, which included downsizing, letting go of 21,000 employees, which accounted for 14 % of the total workforce, shutting down multiple manufacturing plants in Japan and auctioning the aerospace unit. Other industry experts laughed at the plan and Carlos Ghosn’s decision earned him the nickname ‘Le Cost Killer.’
Japan has a hierarchy of age and seniority based promotion. At the time, Nissan had a lifetime employment policy, leading to a complacency which came with the job. Carlos Ghosn changed the employment policy from being a guarantee to a goal which needed to be achieved. Carlos Ghosn also proposed the abolishment of the Keiretsu system which was undermining Nissan’s performance. Keiretsu is an old Japanese concept of cooperation and alliances. Companies form interlocking interests and take up shareholdings. It is an unofficial and an informal form of business alliance which had long held dominance over the Japanese economy. Ghosn’s proposal to abolish this system did not sit well with the Japanese public, caused outrage and earned him the name ‘Keiretsu Killer.’
Upon achieving his targets, Ghosn became an overnight hero in Japan, where outsiders, often referred to as ‘Gaijin,’ find it hard to gain recognition. He was even depicted as a superhero in a Japanese comic book.
After bringing Nissan from the brink of bankruptcy to the second best automobile maker in Japan behind Toyota, Ghosn announced his plan to unveil the Nissan Leaf in 2010. The Nissan Leaf was dubbed as the world’s first affordable zero emission car.
The Renault-Nissan alliance is the leader of the electric vehicle segment in the world, beating Elon Musk’s Tesla. As of 2017, the alliance sold double the number of cars as Tesla.
Arrest and downfall
By 2018, many in Japan and outside were of the opinion Ghosn’s income from both Renault and Nissan was too high. A whistleblower, who was a close aide of Carlos Ghosn, said they had information Carlos Ghosn was instructing his close aide and board member Greg Kelly to create two salary accounts for Ghosn. One account held money which would be paid every fiscal year to Ghosn and the other account would hold a pot which was designated to be paid out to Carlos Ghosn after his exit from Nissan. Nissan went to the authorities with this information and it was found Carlos Ghosn was under reporting his income filings. Following this, Carlos Ghosn was arrested at the Tokyo Airport.
Following the arrest, Ghosn was sent to a detention center and had no contact with anyone except his Japanese lawyer, the Lebanese embassy and the French embassy. He alleged he was mistreated as he is a foreigner.
Carlos Ghosn recently made headlines when he fled from Japan and went to Lebanon via Turkey. Lebanon currently has no extradition treaty with Japan in place, meaning Japan currently has no way to prosecute him. Carlos Ghosn made a statement that he would disclose everything to the media in the coming months.
Read about the rise of Carlos Ghosn here: Carlos Ghosn – The Rise Of A Titan Of Automobile Industry
The Rise Of Gig Economy In India
India is notorious for churning out graduates from colleges at a very high rate and the education system in India is always under fire for not focusing on all round development but on marks and grades, instead. This is a growing concern as there are not enough jobs available to accommodate all the graduates passing out from college. However, the Indian millennial is a smart individual and when put under pressure, a millennial is capable of coming out of it better. So, what did the Indian millennial do when there were less opportunities and did not want to be part of the rat race? They turned to taking up gigs and that spawned an entire economy and industries to flourish.
Gig economy can be defined as a work engagement where on one side, there is a service seeker that is a consumer with a demand for a specific task, and on the other side, there is a service provider that is. a gig worker who can perform that specific task. The gig economy was able to flourish solely because of the advent of digital platforms which were able to connect a service seeker with a provider. More and more Indians are looking to escape from the monotony of a 9 to 5 desk job and instead take up freelance gigs which complement their skills.
In order to put the gig economy into simpler terms, here are some examples. An individual who likes to drive cars would consider working with Uber as a driver partner to earn some extra bucks. An individual who is good at playing the guitar would consider performing in live shows with a band to earn extra money. A person who is good at painting would consider selling their art for extra money. The gig ecosystem offers the millennial an outlet to escape monotony and pursue their passion instead.
The gig economy could only thrive when there are digital platforms which are able to connect the supply with the demand. The digital gig economy generated a gross volume of approximately $ 204 billion from worldwide customers in 2018. India has emerged as the 5th largest country for flexible staffing after the United States of America, China, Brazil and Japan. Haryana, Madhya Pradesh, Andhra Pradesh, Gujarat and Telangana have the most opportunities in terms of growth for the flexible workers.
Gig economy allows task ownership, convenience and flexibility. Based on tastes and preferences, an individual can determine the number and type of projects they can work on, the quantum of their earnings, and thus, their work-life balance. For example, an individual who took on five gigs in one month could take only three gigs the next month to balance life at their regular job.
The gig economy has a disruptive model to connect sellers and buyers for almost all kinds of skills and services. While the size of the gig economy may seem marginal when compared to the traditional economy, it is recognized for its enormous potential with the desire of workers, specially millennials to have a flexible work schedule and the rise in the on demand consumer services. Of In India, almost 70% corporates have already used gig workers for at least one task in 2018.
In India, a platform called Lemonop, is setting an example in the gig economy by providing a platform for students and working professionals to look for gigs of their liking. There are plenty of other platforms like Lemonop which are slowly bridging the gap between talent and job demand.
Mukesh Ambani Enters Top Ten Billionaires List
Mukesh Ambani is the head of India’s biggest Petrochemical and Telecommunications giant Reliance Industries Limited. Mukesh Ambani also achieved a new milestone in his splendid career as he broke out into the World’s Top Ten Richest Billionaires list for the first time in his career.
Mukesh Ambani entered the high profile and exclusive club of billionaires as his net worth jumped to $ 64.5 billion which catapulted him to the exclusive list of the richest billionaires in the world. Mukesh Ambani is now the ninth richest billionaire in the world as he beats Google co founder Larry Page. Mukesh Ambani also holds the distinction of the only Asian tycoon in the exclusive list of World’s Top Ten Billionaires.
Mukesh Ambani is riding on the back of a series of investments into the company’s digital unit, Jio Platforms Ltd., which Reliance claimed made the company net debt free and also proved the COVID-19 pandemic has not affected the fortunes of Reliance Industries.
While a crash in oil prices caused uncertainty in a stake sale of Reliance’s oil and chemicals division, in just two months Jio managed to attract some $ 15 billion which is more than half the investment into telecom companies worldwide this year. A report by popular equity and brokerage firm Sanford C. Bernstein predicted Jio is likely to capture 48% of India’s mobile subscriber market share by 2025.
Mukesh Ambani has an unmatched drive to become the biggest and the best industry leader in India as well as the world. In India, Reliance officially became the biggest petrochemical company last year, when it surpassed government owned Indian Oil Corporation to become the country’s largest company by revenue. Mukesh Ambani said “No power on Earth can stop India from rising higher (sic.)” during Reliance Industries latest Annual General Meeting (AGM.)
Amazon To Deliver Liquor Online In West Bengal
In what could be considered as a game changing move, e-commerce giant Amazon secured clearance to deliver liquor in the Eastern state of West Bengal. The news comes according to a notice put out by the West Bengal State Beverages Corp, the state’s authorized agency to carry out online retail of liquor, on Friday. The notice also said Amazon was one of the companies found to be eligible for registration with the authorities.
This move is significant as Indians consume a huge amount of alcohol but online deliveries have been prohibited, until now. West Bengal is India’s fourth populous state and has a population of more than 90 million people. Amazon was invited to sign a Memorandum of Understanding with the West Bengal state. According to the estimates by IWSR Drinks Market analysis, the market Amazon is looking to make inroads into, is worth $27.2 billion dollars.
When the COVID-19 pandemic reached India, the Government declared a complete lockdown and sale of alcohol was completely prohibited. When the lockdown rules were relaxed and the alcohol shops were allowed to happen, India witnessed a rush to the liquor stores like never before. Following the reopening of wine stores, some States have allowed Swiggy and Zomato to deliver alcohol and the food delivery giants cashed in on the heavy demand.
Each state sets its own alcohol sales policy. West Bengal last month invited companies to express interest in “handling electronic ordering, purchase, sale and home delivery of alcoholic liquors from licensed retail outlets” to eligible legal-age consumers in the state. Grocery delivery major, Big Basket also won approval to deliver alcohol in West Bengal state.
Let us know if you think India will allow online alcohol delivery in the future.
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