For Nissan Motor Co. to survive in the automobile industry, which is experiencing a turbulent period, there is no option but to regain trust and accelerate the recovery of its business results. The new lineup of Nissan's top executives bears a heavy responsibility in this regard.
Nissan has announced its decision to promote Makoto Uchida, 53, a senior vice president in charge of operations in China, to the post of president and chief executive officer. Nissan aims to realize his promotion next January.
Uchida, who previously worked at a trading firm, has been deeply involved in the tie-up with French carmaker Renault SA, which holds more than 40 percent of all Nissan shares. Nissan's decision is likely aimed at giving the impression that its top leadership will be rejuvenated by appointing a young executive.
Ashwani Gupta, 49, who came from Renault and is chief operating officer of alliance partner Mitsubishi Motors Corp., will be appointed COO, and Nissan Senior Vice President Jun Seki, 58, will be the vice COO.
Yasushi Kimura, chairman of the Nissan board of directors, explained the reasons for the appointment of the new leadership during a news conference, saying, "We considered it important to create a 'new Nissan,' giving the impression that Nissan will be reborn."
The selection of new top leaders was made by a nomination committee consisting mainly of outside board directors. The panel was scheduled to decide on the new lineup by the end of October but moved up the schedule to resolve the ongoing turmoil as early as possible. This is understandable.
Former Chairman Carlos Ghosn, a defendant in an upcoming trial, was dismissed for alleged irregularities over such matters as executive renumeration. Former President and CEO Hiroto Saikawa, 65, who supported the Ghosn leadership, resigned over the controversial renumeration he received.
Nissan will shift to a collective leadership led by Uchida, making a clean sweep of the corporate image painted by Ghosn. Uchida will be tested as to whether he can rebuild corporate governance to prevent a recurrence of misconduct and thus enhance the power to unify the company.
The new top leadership must give top priority to tackling the problem of improving corporate earnings.
The Nissan group has about 140,000 employees and the number of companies supplying parts to Nissan exceeds 10,000, including secondary subcontractors. Nissan's performance will thus have a big impact on them.
In the leading North American market, Nissan's brand strength has declined as a result of increasing the sales of its vehicles through unreasonable price cuts, and the impact of this has lingered. The marketing of new models has also been delayed. Nissan needs to go back to the basic point of accelerating the development of new car models, so as to market attractive vehicles.
Nissan plans to cut about 12,500 employees, or about 10 percent of its total workforce, by fiscal 2022. The struggling carmaker is called on to carry out this plan steadily.
Management integration with Renault is also a task to be addressed. Renault is interested in achieving integration but Nissan, which exceeds Renault in business size and technology, wants to stay on an independent path.
It requires a huge amount of investment to promote the research and development of cutting-age technologies, including that related to electric vehicles and autonomous driving. It is first of all imperative for Nissan to strengthen cooperation with Renault.
Uchida is called on to repeatedly hold talks with the Renault side with a view to building a relationship of trust, thereby overcoming the difficult situation his company faces now.
(From The Yomiuri Shimbun, Oct. 13, 2019)
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