Carlos Ghosn, CEO and chairman of Japan's Nissan Motor and Renault of France, is set to become chairman of Mitsubishi Motors, presiding over efforts to turn the troubled automaker around after a devastating mileage scandal.
The Brazilian-born Frenchman, said Mitsubishi's current chairman and CEO, Osamu Masuko, had reluctantly agreed to stay on as CEO.
"I speak for all of us when I say we will give our absolute commitment to support Mitsubishi Motors," Ghosn said at a joint news conference by the two companies. "We are sending a clear message we believe in the underlying strength of Japanese car making."
Nissan paid $237 million for a 34 percent stake in Mitsubishi Motors, becoming its largest shareholder.
"I am relieved that all the processes are complete, including the payment by Nissan," Masuko said.
The changes in Mitsubishi's leadership must still be approved by a shareholder vote expected before the end of the year.
Ghosn said Nissan would provide skills and expertise to help restore trust, enhance regulatory compliance and improve governance at Mitsubishi. As chairman, Ghosn said his focus will be on ensuring Mitsubishi is run in line with shareholders' interests. Masuko will be in charge of management, he said.
"I have no intention to interfere with the management of Mitsubishi," Ghosn said.
Nissan agreed to take charge at Mitsubishi after the company acknowledged in April that it cheated to inflate mileage for two of its minicar models, the eK wagon and eK Space, and mini-vehicles it made for Nissan.
The two companies have said they plan to maintain separate identities, brands and dealerships after the deal. But Nissan will nominate four new board members. Trevor Mann, an executive vice president and chief performance officer at Nissan, will be chief operating office. Mitsuhiko Yamashita, a senior technology adviser at Nissan, will head Mitsubishi's research and development, Ghosn said.
He said Masuko had been keen to resign his post, but agreed to "sacrifice his personal taste and inclination" for the sake of the company in staying on.
"We trust Masuko-san and we have been working with him for many years," Ghosn said.
The mileage scandal widened in August after the government ordered a halt to sales of eight more Mitsubishi models, including the Pajero sport utility vehicle, after finding their mileage ratings also were falsely inflated. The transport ministry said the cruise range on the i-MiEV electric car was also overstated.
No overseas models are affected.
Mitsubishi's vehicle sales in Japan have nosedived and the company faces costs of compensating tens of thousands of vehicle owners in Japan.
Mitsubishi's reputation was already marred by a massive, systematic and decades-long cover-up of defects that surfaced in the early 2000s.
Ghosn vigorously defended Nissan's decision to try to straighten out Mitsubishi, despite its tarnished record, noting that similar questions were raised before he helped revive Nissan's fortunes.
"We're going to demonstrate, hopefully together, that this is a good decision," Ghosn said. "Mitsubishi Motors has more potential than it has shown so far.
"We believe in this. We will have to demonstrate it," he said.