Tensions between Nissan Motor Co. and Renault SA over the future of their car-making partnership have exploded into the open as the downfall of Chairman Carlos Ghosn continues to roil the automotive industry.

The two companies, which are connected via a complex structure of cross-shareholdings and joint manufacturing, have drastically differed in their reactions to Ghosn’s arrest in Japan on suspicion of financial offences.

Tuesday night in Paris, Renault’s board stopped short of firing the French-Brazilian executive, and asked Nissan to hand over details of his alleged misdeeds. Nissan, by contrast, said after he was detained on Monday that it intends to dismiss Ghosn, 64, as chairman — acting with a haste that’s fuelled open speculation that he was the victim of a coup by Chief Executive Officer Hiroto Saikawa, and others at Nissan opposed to deeper integration between the two companies.

Nissan’s board will meet on Thursday to make a formal decision on Ghosn’s future.

Renault’s board indicated that it was in the dark about the nature of the allegations against Ghosn. “At this stage, the board is unable to comment on the evidence seemingly gathered against Mr Ghosn by Nissan and the Japanese judicial authorities," it said in a statement.

No bail

Ghosn hasn’t commented on the developments or appeared in public. Japan’s legal system is opaque even to locals, and basic details of his location and immediate future are unknown, although he’s likely at a detention facility in northern Tokyo. Bail cannot be granted until prosecutors decide whether to proceed with an indictment, a process that could take weeks, and Ghosn will not necessarily be joined by an attorney when he’s questioned during that time.

More than Ghosn’s personal future is at stake.

The charismatic executive led both Nissan and Renault as well as their wider alliance, which unites the iconic French and Japanese companies with the smaller Mitsubishi Motors Corp. He’d championed a push for Nissan and Renault to solidify their two-decade-old relationship by merging, a union that would create a direct rival to Volkswagen AG and Toyota Motor Co. for the title of the world’s largest automaker.

Excessive power

But Nissan CEO Saikawa has publicly played down that prospect, and had harsh words for Ghosn, his one-time mentor, at a press conference late on Monday. “This is an act that cannot be tolerated by our company," he said, arguing that an excessive concentration of power in Ghosn’s hands created an environment ripe for misconduct.

Saikawa’s influence at Nissan will grow in Ghosn’s absence. For now, Renault has named Chief Operating Officer Thierry Bollore as interim CEO, with the same powers as Ghosn. In a letter to Renault employees, he pledged “full support" for Ghosn and to protect the Nissan partnership.

Ghosn stands accused of under-reporting income of about $44 million and misusing company funds at Nissan. However, the full scope of potential allegations is unclear. Nissan has told Renault board members that the company is looking into potential wrongdoing at the alliance’s Amsterdam-based joint venture, RNBV, according to three people familiar with the matter.

So far the French government, which is Renault’s largest shareholder, is reserving judgment on Ghosn. On Tuesday, Economy Minister Bruno Le Maire told France Info radio that “we will not demand he be removed" from the company because “we have no proof." France has examined Ghosn’s local tax records and found “nothing particular," Le Maire added.

While both Le Maire and his Japanese counterpart, Hiroshige Seko, reaffirmed their support for the alliance, the structure of the partnership between the two companies has been increasingly controversial in Japan as Nissan outgrows Renault in sales and profits. Renault owns a 43% voting stake in Nissan, which owns just 15% of Renault — without voting rights.

This story has been published from a wire agency feed without modifications to the text.

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