Ghosn’s detention extended for 10 days — media

TOKYO: Nissan Motor Co chairman Carlos Ghosn will be detained for another 10 days following his arrest on suspicion of falsifying income reports by millions of dollars and misusing company assets for personal gain, according to Japanese media reports.

Nissan’s board of directors is due to meet today and decide if it will dismiss Ghosn and the company’s representative director, Greg Kelly. He was also arrested on Monday on suspicion of collaborating in the wrongdoing.

Their detention was extended for another 10 days, Kyodo News reported. It cited the Tokyo District Court, which declined to comment.

Under Japanese law, suspects can be held for 20 days per possible charge without an official indictment. Additional charges can be tagged on, resulting in longer detentions. Neither Ghosn nor Kelly has been charged so far.

Ghosn is suspected of under-reporting $44.6 million in income from 2011 to 2015, according to Tokyo prosecutors.

The maximum penalty, upon conviction for violating finance and exchange laws is 10 years in prison, a 10 million yen ($89,000) fine, or both.

Despite the high-profile arrests, analysts said the impact on Nissan auto sales would likely be minimal.

“I’d be surprised if it impacts car sales very much,’’ said Christopher Richter, auto analyst for CLSA Securities Japan Co Ltd. “Consumers are discerning enough to say: This car, the wheels might fall off so I’m not going to buy it. This car company, the executive might have done something kind of dodgy, but do I like the car or not.’’

Richter noted sales dips that hit after previous Nissan scandals were temporary. The deviations the automaker acknowledged in those scandals were more directly related to product quality, such as mileage, emissions and plant inspections.

“Nissan’s overall performance won’t be hurt by the absence of Ghosn, as long as the executive team pulls together,’’ said Janet Lewis, an analyst at Macquarie Research.

“The fact the case was initially raised by a whistleblower shows the system was working,’’ she said.

Nissan shares tanked on Tuesday after the scandal surfaced, falling 5.5%. The stock recovered moderately in yesterday’s trading on the Tokyo Stock Exchange, closing up 0.4%.

Masahiro Akita, auto analyst with Credit Suisse, said he was stunned by the news of Ghosn’s arrest.

But he believes operations at Nissan will mainly remain business as usual, while uncertainties about brand image remain.

“It’s not realistic to think the alliance will suddenly change as it is now already operating,’’ Akita said, noting the automakers share platforms, or the basic parts on which vehicles are built, as well as parts purchasing. “You can’t go back on it that easily.’’