UPDATE:Nissan CEO Ghosn Sees More Auto Industry Consolidation

Nissan Motor Co. (NSANY, 7201.TO) Chief Executive Carlos Ghosn said Thursday that the auto industry is likely to continue to consolidate, although that consolidation may not involve traditional mergers and acquisitions.

Speaking at a breakfast event at the Council on Foreign Relations in New York, Ghosn said that tie-ups in the industry may not take place in the "classical" sense but that auto companies would need to find ways to pool resources and partner on technology. The global industry may not be able to continue with the same number of players, he said.

Ghosn pointed to auto companies in India that have been developing technology to produce cheaper cars, an area in which their competitors in the Western world have lagged. Car makers in the developed world haven't put as much focus on frugality, he said. "We've lost that instinct," said Ghosn, who heads the alliance between Nissan and Renault SA (RNO.FR). Cheaper technology development by Indian and Chinese firms makes learning and partnering with these businesses essential, he said.

"We have to make sure we take the Indians and the Chinese very seriously," said Ghosn.

Ghosn spoke at the event with Steven Rattner, the former head of the U.S. Treasury Department's auto task force. Both argued that government support for the auto industry had been essential at the height of the global economic and credit crisis.

Many companies in the car industry, including healthy ones, would have collapsed without government interventions during the economic crisis, said Ghosn. "Because of the exceptional circumstances, what happened had to happen," said Ghosn.

Rattner argued that if the U.S. government hadn't intervened, liquidations in the industry would have put more than 3 million people out of work in the U.S. Rattner was a major architect of the bailout of General Motors and Chrysler LLC. Speaking of the U.S. government's moves to shore up the troubled car companies, Rattner said that a decision was made at the presidential level that the U.S. government wouldn't get involved in the day-to-day decision-making of the companies. The government's moves were about preserving jobs and were "very crisis-oriented," Rattner said.

Ghosn expects the number of jobs globally in the auto industry to eventually rise in coming years as the demand for cars increases in developing markets.

-By Anjali Cordeiro, Dow Jones Newswires; 212-416-2200; anjali.cordeiro@dowjones.com