Nissan searches for a new leader to lift it out of one big mess

X Scalper

But will the next CEO stay the course on Saikawa’s game plan or chart a new path?

In the U.S., for example, Saikawa broke with Ghosn by ordering a pivot away from Nissan’s profit-draining reliance on fleet sales and incentives to shore up brand value and margins.

But that unleashed a painful tumble in U.S. sales. Monthly volume sometimes fluctuated wildly as Nissan tried to work its market levers in accordance with Saikawa’s plan. In June, Nissan Group sales slid 15 percent. But in August, they shot back up 13 percent. Through August this year, sales are down 5.9 percent.

Saikawa set a U.S. sales goal of 1.4 million vehicles in the fiscal year ending March 31, 2023. In May, he outlined plans to restore parent company operating profit margin to 6 percent in that same fiscal year. It finished last year at just 2.7 percent.

Hitting these targets is proving easier said than done.

Restoring ties with Renault is another priority. Relations with its French partner of 20 years sank to a low when Nissan reportedly rebuffed full merger overtures from Renault. Nissan then abstained from backing Fiat Chrysler Automobiles’ proposed merger with Renault.

Saikawa had kicked talks on alliance reform down the road, arguing that Nissan first had to get its house in order. With Nissan’s corporate governance overhauled and Saikawa’s departure bringing closure to the Ghosn era, those difficult Renault decisions loom closer.

“The alliance with Renault is a big challenge for us,” Saikawa said.

A change of guard could help. Insiders say Saikawa and Renault CEO Thierry Bollore never quite meshed. Acting CEO Yamauchi is said to be held in higher regard by counterparts in France.

Finally, the new CEO must mop up the residual mess of the Ghosn scandal.

A nearly yearlong audit of that situation resulted in a report to the board last week about the scope of the damage. According to the report, Nissan incurred some $327 million in damages through financial malfeasance allegedly conducted by Ghosn and Greg Kelly, a former Nissan director who is awaiting trial in Japan with Ghosn. Both Ghosn and Kelly deny the charges.

A substantial portion of those millions has been disbursed to Ghosn, the report said. Kimura said Nissan is consulting lawyers to pursue restitution.

Ghosn’s U.S. lawyers at Paul, Weiss, Rifkind, Wharton & Garrison called Nissan’s position “inconsistent, contradictory and incoherent” and said the accusations were baseless and part of an “orchestrated coup” to oust Ghosn as chairman.

The legal battle will likely erupt into more public embarrassment next spring when the Ghosn saga goes to trial.

Be the first to comment

Leave a Reply

Your email address will not be published.