Does Renault-Nissan’s dual-CEO Carlos Ghosn blame America for using #dieselgate as a pretext for an attack on the EU car industry? Ghosn wrote a letter to EU trade ministers, the letter made it into the London Times (paywall), where it triggered the headline “US accused of raid on ‘superior’ European diesels to save its own.” The Dailykanban has the backstory.
Ghosn wrote, says the Times:
“We understand that the US want to challenge the leadership role that European manufacturers have taken globally in this technology, which has created jobs across the entire supply chain in Europe.”
Basically, Ghosn urged EU governments not to succumb to knee-jerk reactions. Drastic measures could severely hurt the EU car industry which is heavily dependent on diesel. More than half of the new cars sold in Europe are diesel-driven. Millions of EU jobs depend on its carmakers.
However, the anti-American letter was never sent.
Here is what really happened.
In the course of #dieselgate, the EU auto manufacturer association ACEA was approached by an EU commissioner’s office, and asked to write a letter outlining how many jobs depend on the EU auto industry, a highly reliable EU source close to the matter tells the Dailykanban. Carlos Ghosn is the current president of ACEA, a job that is filled by EU automaker CEOs on a rotating basis. (“I doubt Mueller will get the job in 2016,” the source quipped.) Of course, the letter to Brussels would have been under Ghosn’s signature.
A draft was written and circulated among the many members of ACEA. Then, someone leaked the draft. The actual letter sent to Brussels by Carlos Ghosn on behalf of ACEA and all EU auto manufacturers did not contain the language about Detroit trying to make hay out of dieselgate, as true as it may be. The real letter is here.
Making the matter worse: The Financial Times was on the story before the London Times. The FT unearthed the real letter days ago. Today, the London Times falls for a draft that was never sent.
Last Wednesday, France’s Economy Minister Emmanuel Macron also pointed fingers at Detroit, saying that “American competitors … look to weaken European industry through this scandal.”
Ed Niedermeyer yesterday pointed out the larger political backstory. Also, negotiations of transatlantic and transpacific trade deals are in their final phases, despite Detroit’s desperate attempts to bring, or at least water them down. The U.S. car industry is behind a huge wall of non-tariff barriers that severely hampers the importation of cars, and that makes importation of light trucks a losing proposition. This helped Detroit to jack-up pickup prices to luxury car levels. Detroit is dependent on its truck profits. Picture a junkie when you take away his heroin, and you know how Detroit reacts to any attempts to weaken the shield from outside competition.
Common standards for testing and homologation are part of the trade deals. Under EU rules, a test in Germany is valid everywhere in Europe. Under ECE rules, it is valid in most of the world, except the U.S. and Canada. As a global automaker, you welcome a global alignment, because it saves time and money. As a Detroit automaker, you are horrified, because there is one less barrier to duck behind.
Now doesn’t it come in handy that you can tell your Senator during a Georgetown dinner: “You really want to trust those cheating Krauts?” This, of course, is also better discussed in a one-on-one tete-a-tete in a Brussels restaurant, and not put into an official letter.
