Executives and analysts believe the future chief executive of Nissan must prioritize a recovery in profits if the company is to repair its relationship with Renault.
Current chief executive Hiroto Saikawa announced he will step down from his role at the head of the company on September 16 after an internal investigation found he had been overpaid, something he soon admitted himself.
Word of Saikawa and other executives receiving undue payments couldn’t have come at a worse time for the Japanese car manufacturer who was trying to do some damage repair to its image following the arrest of former chairman and industry mainstay Carlos Ghosn.
Reuters reports that it is crucially important Saikawa’s successor lifts profits from a more than decade low. The car manufacturer’s earnings have been undercut significantly by heavy discounts and low-margin sales to rental firms that have cheapened the company’s image. Dealer profits, especially in the United States, are also suffering.
“It goes without saying recovery is the biggest priority,” an anonymous Nissan executive said. “We have Renault’s understanding on that.”
Current Nissan chief operating officer Yasuhiro Yamauchi will take over from Saikawa next week on an interim basis, as a newly created nominations committee looks to recommend a successor by the end of October.
Tensions within the Renault-Nissan Alliance have deepened following Ghosn’s arrest last year and the failed merger with Fiat Chrysler Automobiles. Renault holds a 43.4 stake in Nissan while the Japanese automaker only owns a non-voting 15 per cent stake in its French partner. Nissan wants to even-up the alliance, but before it does so, will need to ensure it improves its own profits.