Carlos Ghosn’s successor at Nissan may fail to get partner Renault’s backing if he continues to oppose merger
- Japanese carmaker is set to announce its lowest annual operating profit in a decade on Tuesday, raising the possibility of a dividend cut
- CEO Hiroto Saikawa job security will come next month, when Nissan’s directors will formally adopt new corporate governance rules that include creating a more independent board
Carlos Ghosn’s arrest threw Nissan Motor into a corporate tailspin with allegations of self-dealing, profligate spending and filing false statements. Now the carmaker’s profits are falling off a cliff, and successor Hiroto Saikawa may go down with them.
Troubled by slumping US sales, ageing models and a product cycle that’s out of sync, the Yokohama-based company is on track to announce on Tuesday its lowest annual operating profit in a decade, raising the possibility of a dividend cut. The outlook for the current financial year to March 2020 probably won’t be any more promising.
Chief executive officer Saikawa has yet to announce a turnaround plan since the arrest of former chairman Ghosn in November, and people familiar with the matter say there’s internal strife over whether he’s the right executive to fix Nissan. Alliance partner Renault may not look too favourably on Saikawa’s reappointment if he continues to oppose a merger said to be backed by its own chairman Jean-Dominique Senard, who is also a Nissan director.
In addition, alliance partner said it would block Saikawa’s reappointment if he didn’t agree to a merger – a request made by Renault’s new chairman that Saikawa batted away, the Yomiuri newspaper reported last month.
“A new management team and strategy may be the answer,” said Michael Dean, a Bloomberg Intelligence analyst.