Nissan Motor Co. is reportedly preparing to replace its CEO, Makoto Uchida, following disappointing financial results and the collapse of merger discussions with Honda Motor Co. Sources familiar with the matter revealed that Nissan’s board is evaluating potential candidates to succeed Uchida, who has been leading the company since 2019. Nissan declined to comment on the matter.
The news of Uchida’s potential departure sent Nissan’s shares up as much as 4.9% in Tokyo on Thursday morning. Bloomberg Intelligence analyst Tatsuo Yoshida suggested that the decision reflects Nissan’s continued efforts to secure a strategic partner to ensure its survival.
Nissan is set to appoint Jeremie Papin, who was appointed CFO in December, as Uchida’s successor.
Uchida, 58, recently acknowledged that while he was prepared to step down if asked, he wished to stabilize the company’s business first. In an announcement earlier this month, he forecasted a net loss of ¥80 billion ($536 million) for the fiscal year ending in March, a sharp contrast to his earlier projection of a ¥380 billion net profit.
The automaker is also grappling with an impending debt crisis, as all three major credit rating agencies have downgraded its ratings to junk status following two recent downgrades. Nissan’s negotiations with Honda, initiated late last year, fell apart this month after disagreements over the terms of a proposed merger under a joint holding company.
Despite the failed merger talks, Honda and Nissan have pledged to maintain a strategic partnership with Mitsubishi Motors Corp., focusing on electric vehicle (EV) batteries and software development. Uchida had emphasized the importance of future partnerships for Nissan’s long-term survival, acknowledging the difficulty of moving forward without such alliances.
Nissan’s outdated product lineup has also posed a challenge, with the company forced to offer heavy incentives to move inventory. In November, Uchida announced plans to reduce Nissan’s workforce by 9,000 and cut 20% of its production capacity.
The path forward remains uncertain. Renault, Nissan’s largest shareholder and long-time partner, expressed dissatisfaction with Honda’s approach to the merger negotiations and praised Nissan’s decision to walk away. Renault’s CEO, Luca de Meo, suggested that China’s Zhejiang Geely Holding Group could be a more natural partner for Renault in the future.
Meanwhile, Taiwan’s Foxconn, formally known as Hon Hai Precision Industry Co., approached Nissan in December about acquiring a stake in the company. Foxconn, which is seeking to expand into EV manufacturing, also indicated its interest in acquiring Renault’s 36% stake in Nissan.
Additionally, U.S. private equity firm KKR & Co. has reportedly explored potential investments to help strengthen Nissan’s financial standing.
As Nissan navigates these challenging times, its next steps in leadership and strategic partnerships will be critical to its survival and recovery.
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