Renault's Drive to Promote France to Japan

CEO Louis Schweitzer explains how the carmaker is pushing to bridge cultural gaps between his company and merger partner Nissan

Louis Schweitzer, the low-key CEO of Renault, transformed the midsize French auto maker into a global player with his 1999 alliance with Japan's Nissan Motors. He has since expanded the company by acquiring Samsung in South Korea and Romanian auto maker Dacia, which will develop and make a 5,000-euro ($4,400) car for consumers in poor countries.

Schweitzer's management combines tough goals for the affiliates and great respect for their cultures. As befits a company with growing clout and ambitions, last month Renault set up the Renault Foundation to promote French language and culture abroad. On Mar. 27, Schweitzer traveled to Tokyo to unveil the foundation's first project -- a scholarship program aimed at training managers for careers in multinational companies.

This month, it will send 22 top-level Japanese students to France for 15 to 17 months of studies at French universities, internships, and travel around Europe. BusinessWeek's Frankfurt Correspondent Christine Tierney spoke with Schweitzer about the scholarship program and his multinational company. Edited excerpts of their conversation follow:

Q: What's your objective in establishing this scholarship program?


We feel our role as Renault is to make French culture better known to the Japanese. This could expand to other countries where we're present, but the top priority is Japan, because of our relationship with Nissan and because we feel it's where the need is greatest.

When we started our negotiations with Nissan, we were in competition with DaimlerChrysler. We noticed the view of France in Japan was very outdated and [not] in line with reality. France wasn't perceived as an industrial nation. If you'd asked people at Nissan if there were good French autos, they wouldn't have known. For example, if you'd asked them France's rank among exporting nations, they would have said around 25th, and I believe we're No.4, and so on. For us, it's a disadvantage [for people to have] an outdated image of France.

Q: Do you expect the graduates of the scholarship program to work for Renault or Nissan?


We might suggest to some to come work for Renault, and some of them might want to work in France, but we're not picking students as a pre-recruitment for Renault.

Q: It has been nearly two years since Renault and Nissan forged their alliance. What are the biggest differences between the two companies?


Quite clearly the French, and Renault specifically, are creative and inventive, and love to look at methods that haven't been tried before. Our friends at Nissan are probably better organized, much more systematic. And if you look at the car-development process at Nissan, you see that their methods are much more standardized. That means less trial and error, but also less likelihood of going into unexplored territory, because the process is organized to follow the paths you know will lead to success.

Q: In what language do managers from the two companies communicate?


English is and will be the common language. A large number of Nissan people speak English because they've worked in the States. We're developing English-language training in Renault for recruits and for people already in the company.

Q: Renault has sent 32 managers led by Carlos Ghosn, now Nissan president, to Japan. How many Japanese managers work in France?


In France, we now have around 30 people from Nissan at different levels. Clearly we want more Nissan people in France in high-level management and operational jobs. This is a major objective. It means we'll need to attract young, high-potential Nissan managers [fairly fluent] in English and ready to learn the essentials of French -- not to work in French but to be able personal relationships in France and to feel better in France.

We'd want these people to spend a few years in France to gain an in-depth knowledge of Renault. I would foresee a time when we'd have a number of Japanese at the top-management level of Renault, people who've had most of their experience at Nissan.

Q: What time frame?


Hopefully five years. At the management-board level, we have one Nissan member, Tsotumo Sawada, but mostly in an advisory position. I would like to have people with direct operational authority [on the board] within this time frame.

Q: DaimlerChrysler's case inevitably comes to mind when one discusses combining different automotive cultures. From your experience, do you believe that DaimlerChrysler can establish a common culture across the group?


They probably did strive to create a common culture at the start. They stated this, and I think that was mission impossible.

Q: Why?


I believe Daimler is a very German company, and Chrysler is a very American company. Now a German company and an American company can work very well together, even within a group, but if you try to merge these companies, these cultures, you'll find it's very difficult. The objective isn't to have the other adopt your way of doing things. It's to work with him, which is quite different.

I talked about the way we develop cars and the way Nissan develops cars. If we tried to tell Nissan people the way we develop cars is the right way -- "explore, explore, explore" -- or if we said to Renault people, the way Nissan develops cars, which is "follow the path, follow the path, follow the path," the process wouldn't work for the other company. So we can learn from Nissan, and Nissan can learn from us.

But learning is one thing. It's another to transplant a process, as is, and I think it's a mistake.

Edited by Thane Peterson

Before it's here, it's on the Bloomberg Terminal. LEARN MORE