Nissan CEO tells angry shareholders he is ready to be sacked if no turnaround

Monday, 24 February 2020 00:00 - - {{hitsCtrl.values.hits}}

YOKOHAMA (Reuters): Nissan’s new chief executive said on Tuesday he would accept being fired if he fails to turn around Japan’s second biggest automaker which is grappling with plunging sales in the aftermath of the scandal surrounding ex-chairman Carlos Ghosn.

Makoto Uchida, who took over the top job in December, put his job on the line at a raucous shareholders’ meeting, where he faced demands ranging from cutting executive pay to offering a bounty to bring Ghosn back to Japan after he fled to Lebanon.

Nissan Motor Chief Executive Makoto Uchida speaks during a news conference at Nissan Motor headquarters in Yokohama - Reuters

Nissan’s worsening performance has heaped pressure on the 53-year-old Uchida, formerly Nissan’s China chief who became its third CEO since September, to come up with aggressive steps to revive the company.

On Tuesday, Uchida, who faced repeated heckling by shareholders, said he was ready to face dismissal if he failed to improve profitability at the company, which is on course to post its worst annual operating profit in 11 years. “We will make sure that we steer the company in an effective way so that it is visible in the eyes of viewers. I will commit to this: if the circumstances remain uncertain you can fire me immediately,” he said.

Uchida did not give a timeframe for improving Nissan’s performance.

The new boss must prove to the board he can accelerate cost-cutting and rebuild profits at the 86-year-old Japanese giant, and that he has the right strategy to repair its partnership with France’s Renault, sources have told Reuters.

Uchida pleaded for patience while he compiles a plan by May to recover from crumbling profits and a corporate shake-up following Ghosn’s arrest in Japan in late 2018 over financial misconduct charges.

“If you can be patient a little bit longer, on a day-to-day basis you will be able to sense we are changing,” he said.

Shareholders’ pain

Angry shareholders questioned the ability of Uchida and other executives to lead Nissan’s recovery, and aired misgivings about issues including ex-CEO Hiroto Saikawa’s resignation, transparency into the company’s probe into Ghosn and the use of Toyota vehicles to transport board members.

Attendance at the meeting to vote in new directors, including Uchida and Chief Operating Officer Ashwani Gupta, stood at 666 and was the lowest on records dating back to 2005. Before it began, some shareholders demanded more clarity about Uchida’s plan.

“I just want to know what the plan for recovery is. At the moment, the share price has dropped again, and the value of the company has plummeted,” said a 70-year-old former employee who owns shares in the company. “If this is the situation, part of me thinks that we would be better off with Ghosn ... If we don’t get a clearer vision of the path the company is taking, it will be a worry.”

Nissan’s shares are trading around their lowest level in more than a decade following its latest earnings.

Last week, it cut its dividend outlook to its lowest since the 2011 financial year, after dwindling car sales drove the company to post its first quarterly net loss in nearly a decade.