Renault turns to a former rival to lead the French carmaker out of the Carlos Ghosn era

January 29, 2020, 12:39 PM UTC

Luca de Meo, the 52-year-old Italian, has long been considered one of Europe’s best and brightest auto executives, even if still largely unknown beyond the industry. Renault’s board though knew precisely what they were getting in selecting him on Tuesday to become the French automaker’s new chief executive. 

For insiders, the biggest question surrounding his appointment might have been why it took the former boss of Seat, Spain’s only carmaker, so long to finally take his place at the top rung of a major auto brand. Few can boast of such a varied resume that includes key stops at Toyota, Fiat and Volkswagen. 

A marketing buff credited with resurrecting the Fiat 500 back in 2007 and, more recently, turning around Seat, he was once considered a candidate to replace the late legendary Fiat Chrysler boss Sergio Marchionne. 

Come July, de Meo will soon face his greatest challenge—breathing life back into a moribund Renault. 

“De Meo is a sales and marketing expert. He knows all the brands and what appeals to mass market consumers. That’s where his strengths lie,” Bernstein analyst Thanos Hadjiantonis told Fortune

In the process, the Milan native beat out Clotilde Delbos, Renault’s finance chief and interim boss ever since the board sacked Thierry Bollore in November in a bid to rekindle the ailing alliance with Nissan.

Mired in troubles ever since Japanese authorities arrested then-CEO Carlos Ghosn over a year ago for alleged white-collar crimes, Renault warned on profits in October and scheduled a complete strategic overhaul. Shares lost a quarter of their value last year even as European auto peers collectively posted gains of 15 percent. 

On Wednesday, Japanese brass weighed in with their approval of the hire. “I am very happy with the Renault Board’s decision to appoint Luca de Meo as CEO,” Nissan Motor Co. representative executive officer, president and CEO said Executive Officer, President and CEO Makoto Uchida, said in a statement. “We are all looking forward to working closely with him and our Alliance partners in our efforts to support mutually profitable growth.”

A “visionary” strategist

“Luca de Meo is a great strategist and visionary of a rapidly changing automotive world,” said Renault Chairman Jean-Dominique Senard. “His expertise, but also his passion for cars, make him a real asset for the Group.”

Until de Meo’s 2009 defection to Volkswagen, he was being groomed as successor to Marchionne at Fiat Chrysler. While still in his 30s, he assumed responsibility for the flagship brand of the same name, later cementing his claim to the Fiat throne by adding Alfa Romeo to his portfolio.

The abrupt departure north surprised many—the position of marketing boss for the VW brand was one that kept him far from the boardrooms of Wolfsburg. It represented an apparent step down on his career ladder and his future there seemed uncertain given a hierarchical culture unforgiving to outsiders—even to Germans. 

No longer in the limelight, De Meo went about quietly building on his accomplishments. In 2012 he was promoted to sales and marketing chief at VW’s premium brand Audi, where he soon clashed with Germans advising him to glorify its past accomplishments. 

Instead de Meo chose to push Audi as the most progressive premium brand, preferring to outfit Marvel’s Iron Man with an electric R8 sports car than fight Mercedes-Benz for product placements in the Jurassic Park film franchise. 

“I’ve worked for brands (like Alfa) that have a much bigger tradition and no present,” he told reporters at the time. “I’d prefer to have a present and future than look back at how nice things were 50 years ago.”  

His instincts proved right as Audi sales grew by a quarter during his three-year tenure. In the immediate aftermath of the diesel scandal, Volkswagen’s board then picked him in November 2015 to run the group’s low-profile Seat brand.

There he took a company that was breaking even to one that was able to increase volumes at a double-digit rate for three years in a row. Not only did Seat turn into one of the fastest growing carmakers in Europe, it became the leading entry point into the group for new customers by winning large numbers from rivals.  

In the process, De Meo convinced Wolfsburg that Seat should return to the crowded Chinese market, winning him the plum assignment to develop for the group a new low-cost platform that will underpin a family of small, affordable electric vehicles. He also launched the Cupra performance sub-brand, patterning it on his revival of Fiat’s Abarth, to more effectively challenge Alfa Romeo.

His to-do list

Only an hour after Renault’s announcement on Tuesday, interim Seat boss Carsten Isensee took a moment during a car presentation to praise his former boss, thanking de Meo for “his effort and dedication over the past years to take this company to another level.”

Renault is a different animal to Volkswagen, however, and de Meo will face two key shareholders at odds with each other in the interventionist-prone French state and a reluctant Nissan that together own 30% of the company. 

Bernstein’s Hadjiantonis believes de Meo knows how to navigate his way through sticky situations. When Barcelona-based Seat, the 1950s brain child of centralist Spanish dictator Francisco Franco, found itself in the middle of Catalonia’s push for independence in 2017, de Meo managed to deftly steer clear of the volatile politics. Paired with the operationally strong like Delbos, the two could form a formidable duo, he argues.

“That he survived for so many years at Volkswagen as a non-German tells you a lot,” said Hadjiantonis. 

UPDATE: This story has been updated to include in paragraph eight a statement from Nissan Motor Co. on the hire of Luca de Meo.

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