Nissan-Renault CEO expects “three to four more years of stagnation” in Europe image

Renault Nissan CEO Carlos Ghosn expects “three to four more years of stagnation” in the European auto business, Reuters reports.

Speaking at an industry breakfast in New York, Ghosn said the companies were “planning for the worst” in Europe, where auto sales have fallen along with the continent’s economies.

However, he told Reuters he was confident the Eurozone would stay together, believing that even if Greece and Spain were exiled from the euro, “it would only be temporary”.

Ghosn said: “European consumers, facing tremendous uncertainty in their lives, are holding off from making large purchases like cars.

“Companies need to be strong enough to make it through three or four tough years to outperform rivals.”

Ghosn, 58, said he is not working toward a merger of the French and Japanese automakers and does not see one after his tenure.

“I don’t think I will see a merger even if I retire,” Ghosn said.

European car sales fell for a sixth straight month in March which reflects the deepening slump in France, Italy, Germany and Britain. New registrations were down 6.6% to 1.5 million cars which is the lowest level in the month of March since 1998.

Europe is an important source of revenue for the global car industry, but many automakers are struggling to operate profitably in Europe as the sector is squeezed by around 20% overcapacity.

Unlike in North America, automakers in Europe refrained from large-scale cutbacks during the last industry downturn in 2009, partly due to political resistance.