From BBC News
Originally Posted by BBC
Bosses at carmakers Nissan and Renault have given chief executive Carlos Ghosn the go-ahead to open talks with rival General Motors on a possible alliance.
Both firms said the talks would be subject to GM backing the proposal put forward by one of its main shareholders - Kirk Kerkorian's Tracinda Corp.
Mr Kerkorian wrote to GM in late June, urging it to join the car alliance.
It is thought that GM board members will discuss his proposal during a conference call on 7 July.
Reports have suggested that Renault and Nissan could take a 20% stake in GM, which lost $10.6bn (£5.7bn) in 2005.
Renault has a 44% stake in Nissan, which in turn owns 15% of the French carmaker.
Big reputation
Both firms co-ordinate their corporate strategies and product development.
The board of GM said last week that it would consider Mr Kerkorian's proposal, but that it had received no offer from Renault or Nissan.
According to a report from the Reuters news agency, Mr Ghosn expressed an interest in acquiring a stake of up to 20% in GM at a dinner with Mr Kerkorian last week.
He has often said that the seven-year-old alliance between Renault and Nissan could be expanded, although this would not have to include an equity partnership.
Mr Ghosn is credited with rescuing Nissan from major financial difficulties in 1999, and recently announced a major revival strategy for Renault, which runs through to 2009.
"Ghosn commands such symbolic significance as a reform specialist," said Shinji Kitayama, an auto analyst with Shinko Securities.
"If GM management can't do the job, why not let Ghosn give a try in leading the company? That's the message."
But some analysts think an alliance featuring GM could be too unwieldy.
"Our view, at the moment, is it would be a complicated alliance to execute successfully and would take quite a bit of time," said Robert Schulz, a credit analyst at Standard & Poor's.
Nissan shares rose about 0.6% on Japan's Nikkei index of leading shares on Tuesday.
General Motors' shares were the biggest fallers on the New York Stock Exchange's Dow Jones index on Monday, down by 1.3% on a day when the wider index rose 0.7%.
The fall was mainly attributed to some disappointing sales figures.
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