Bowing to pressure from the French government, embattled auto executive Carlos Ghosn resigned as chairman and CEO of Renault. This was announced by French Foreign Minister Bruno Le Maire at the World Economic Forum in Davos, Switzerland and later confirmed by the automaker.

The resignation preceded a scheduled meeting by Renault's Board of Directors to replace him upon the request of the French government, the automaker’s largest shareholder. The move is also seen to ease tensions with Alliance partners Nissan and Mitsubishi Motors.

Ghosn has been under custody in Japan for alleged incidents of financial misconduct since November 19. Also charged was fellow Nissan director Greg Kelly, a close aide. Both executives have denied the allegations.

Considered the brains behind the Renault-Nissan Alliance, Ghosn was considered instrumental in turning around both automakers during difficult periods. The prosperous alliance welcomed Mitsubishi Motors to the fold in 2016. The Renault-Nissan-Mitsubishi Alliance became the largest automotive partnership, besting Toyota Motor Corp. and Volkswagen Group in 2017 with 10.6 million vehicles sold. 

The announcement of Ghosn’s resignation at Davos is ironic, as he was once a quintessential figure among global executives, global ministers, and head of states for the annual meeting.

The Renault Board voted to install Michelin CEO Jean-Dominique Senard as its new Chairman and confirm Thierry Bolloré as CEO. Bollore has been the company’s acting CEO since November 22, following Ghosn’s arrest.

The Renault board also took the opportunity to institute a “new governance structure” which separates the functions of its Chairman and CEO.

Senard is now tasked to manage Renault’s relationship with alliance partners Nissan Motor and Mitsubishi Motors.