 "Is Nissan looking to replace CEO Uchida over poor earnings, failed Honda merger talks?")
Nissan Motor Co. is exploring options to replace Chief Executive Officer Makoto Uchida following disappointing financial results and the collapse of merger talks with Honda Motor Co.
Nissan’s board is assessing interest from potential candidates to succeed Uchida, who has led the company since 2019, Bloomberg reported citing a person familiar with the matter.
Uchida, 58, acknowledged earlier this month that he was willing to step down if asked but said he wanted to stabilise Nissan’s business before leaving. The automaker is projecting an ¥80 billion ($536 million) net loss for the fiscal year ending in March, a sharp reversal from the ¥380 billion net profit it had forecast just nine months ago.
Mounting debt pressure
Nissan faces mounting financial pressures, with a record debt bill coming due next year. Credit rating agencies have downgraded its debt to junk status, including two separate downgrades in the past week.
Nissan has also been struggling to attract consumers with an ageing vehicle lineup and has relied heavily on incentives and promotions to clear inventory. In November, the company announced plans to cut 9,000 jobs and reduce production capacity by 20 per cent.
In an effort to secure a strategic partner, Uchida had sought a merger with Honda, reaching a tentative agreement late last year to combine under a joint holding company. But negotiations broke down earlier this month due to disagreements over deal terms.
Way forward remains uncertain
While the merger talks collapsed, Nissan, Honda, and Mitsubishi Motors Corp. have agreed to continue collaborating on electric vehicle batteries and software development.
Nissan’s largest shareholder, Renault SA, was critical of Honda’s negotiation stance and supported Nissan’s decision to walk away. However, Renault has been distancing itself from Nissan, with CEO Luca de Meo recently suggesting that China’s Zhejiang Geely Holding Group Co. could be a more suitable long-term partner.
Taiwanese electronics manufacturer Foxconn, approached Nissan in December about acquiring a stake in the company. Foxconn, which is looking to expand into electric vehicle production, has also expressed interest in buying Renault’s 36 per cent share in Nissan.
Impact Shorts
More ShortsUS private equity firm KKR & Co. has explored a potential investment– either in the form of equity or debt– to help improve Nissan’s financial position, Bloomberg reported citing sources familiar with the discussions.
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