Ghosn Planned to Oust Nissan CEO Prior to Arrest in Japan, Sources Claim
Prior to his arrest in Japan last month over presumed financial misconduct, Carlos Ghosn was allegedly planning to remove Nissan CEO Hiroto Saikawa. The plot has certainly thickened.
Ghosn, who was serving as Nissan Motor Co.’s chairman before being taken into custody, was believed to be on the cusp of an upper-level management shakeup within the Renault–Nissan–Mitsubishi Alliance. Part of that plan included finding a new CEO for Nissan, according to inside sources.
The Wall Street Journal, who broke the story, reported that timeline of the managerial restructuring was cloudy but involved a meeting scheduled for November with Ghosn hoping to pull the trigger by next spring. “He was getting ready for a shakeup that was going to affect Saikawa,” one source claimed. “It was a path to a different CEO.”
However, any ousting of Saikawa would likely require is involvement in some high-profile scandal (which may yet happen) and/or approval from the automaker’s management board. Bloomberg later claimed that people familiar with Ghosn’s case and Nissan’s operations said there was no plan to eject Saikawa prior to the end of his term, which is slated to continue through April of 2019.
Nissan said it cannot comment on matter at this time. But we can speculate as to why Ghosn might have wanted the CEO removed. Nissan’s financial performance under Saikawa hasn’t been the mind-blowing success story it was when Carlos at the helm. The company’s operating income dropped by 17 percent in the first half of 2018.
Saikawa also pulled back on Ghosn’s strategy of setting extremely ambitious volume targets and has taken heat from the former chairman over the automaker’s continued involvement in the final-inspection scandal that has persisted within its home country. Thus far, Nissan is believed to have recalled at least 1 million vehicles in Japan for failing to adhere to national safety mandates.
The pair have also been ad odds over the on extended power struggle taking place within the Renault–Nissan–Mitsubishi Alliance, an issue Ghosn spent most of 2018 trying to downplay. It’s clear Ghosn he saw the the Alliance as his baby and even seemed to be pushing for a full-blown merger for a while. However, Saikawa stressed the importance of Nissan remaining independent, echoing the tone of its Japanese investors. In July, Carlos attempted to calm shareholders who had caught wind of consolidation rumors.
“Anybody who will ask Nissan and Mitsubishi to become wholly owned subsidiaries of Renault has zero chance of getting a result,” Ghosn said over the summer. “We have not done it for the last 19 years. We’re not going to change today.”
Be that as it may, the former chairman also expressed a dire need for Alliance members to solidify their relationship before its current high-level decision makers retire. There’s a possibility Ghosn had very specific designs for that, which included a new CEO for Nissan that would see things his way.
Monday marks end of Ghosn’s 22-day detention, having been held without charge since his arrest on suspicion of under-reporting compensation for five years. While there’s no guarantee what will happen next, some have posited that he’ll be re-arrested prior to any official indictment. Legal experts have also claimed Japan may dub him a flight risk and deny bail — a relatively common practice that the nation has been criticized for in the past. Japan has a ludicrously high conviction rate and sometimes goes to greater lengths to punish non-violent crimes than Western nations. The United Nations, Japan Federation of Bar Associations, and various human rights groups have criticized the country’s legal system in the past.
Prosecutors are also rumored to hold Nissan accountable for publishing the documents which allegedly misrepresented Ghosn’s remuneration. Official charges are expected to be launched soon.
[Image: Nissan]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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I suspect Ghosn or anybody else was/could have been working on anything exciting enough for this article to have been written at nearly any given time. "Take a card, any card." "Look, the three of clubs!" "What are the odds?" "1 in 52, same as every card."
It may not all be Saikawa's fault. Maybe some people are waking up to the fact there are better built cars out there for the money. I know I will never own another Nissan and I can't be the only one.