TOKYO -- The heads of Nissan Motor, Mitsubishi Motors and Renault will gather Wednesday to discuss Fiat Chrysler Automobiles' proposed merger with the French automaker, as Nissan reckons with the question of how to deal with the changes to the alliance that would ensue.
How Renault presents the offer to its two alliance partners will be a central point of the regular meeting, which will be attended by CEO Thierry Bollore and Chairman Jean-Dominique Senard from Renault, Nissan President and CEO Hiroto Saikawa and Mitsubishi Motors Chairman and CEO Osamu Masuko.
"I think that all the recent events are very good for the alliance, and I will make sure that Nissan and Mitsubishi will take great advantage of the news," Senard told reporters Tuesday.
FCA's merger proposal to Renault states that the deal would generate "significant benefits to the other alliance partners," including an estimated 1 billion euros ($1.12 billion) in synergies.
Adding the Italian-American company to the alliance would expand it significantly, particularly in key auto markets. Renault, Nissan, Mitsubishi Motors and FCA sold a combined 15.59 million vehicles worldwide last year, which would have put them in first place ahead of Volkswagen.
In the U.S., where Jeep and other FCA brands are particularly strong, the four companies together sold well over 3.8 million vehicles, more than market leader General Motors. Their combined sales in Europe came close to Volkswagen's.
Saikawa indicated Monday that he is open to discussing the proposal, saying he considers the news "positive for the future overall."
But a merger risks weakening Nissan's position in the alliance. Renault owns 43.4% of Nissan, which holds just a 15% nonvoting stake in its French partner. Yet the Japanese company has been the main driver of the three-way partnership in both size and technology, accounting for more than half the 10.75 million autos sold by the trio in 2018. Including FCA would drop Nissan's contribution to 36%.
The deal also could undercut Nissan's sway in new technologies such as self-driving vehicles. FCA has a partnership with Alphabet unit Waymo, which launched an autonomous taxi service in the U.S. late last year using Chrysler minivans.
FCA's proposal would further complicate the capital relationships involved in the alliance as well.
Ownership of the combined company would be split 50-50 between FCA's and Renault's current shareholders. This would dilute the influence of the French government, which has used its 15% interest in Renault to press for integration between the automaker and Nissan. Bruno Le Maire, the French economy and finance minister, said Tuesday that any merger must take place within the framework of the Nissan-Renault alliance.
Meanwhile, Fiat's founding family would retain considerable influence. They currently own 29% of FCA and would control 14.5% of the combined company.
The agreement setting out the terms of the alliance lets Nissan increase its Renault shareholdings at its discretion if there is undue interference in the Japanese automaker's management from Paris or elsewhere. Should this stake rise to at least 25%, Renault's Nissan shares would lose their voting rights under Japanese law.
If FCA and Renault merge, and the combined entity takes the French automaker's place in the alliance, Nissan might demand changes to the agreement.
"From the standpoint of Nissan's interests, we need to look a little closer to see what sort of contractual relationship the deal would create" between FCA and Renault, Saikawa said Monday.
If the alliance terms are changed, it is unclear whether the combined FCA and Renault would let Nissan retain the right to guarantee a degree of independence. With FCA in the mix, the new company could raise the pressure on its Japanese partner.