Nissan Could Replace CEO Amidst Dismal Earnings, Failed Merger

Rumors that Nissan wants to replace its CEO began surfacing in the fallout from the automaker’s failed merger with Honda. Now, a new Bloomberg report alleges the company’s directors are looking for potential candidates to replace Makoto Uchida, who has led the company since 2019.

The report, published Thursday, says the directors want to change the company’s leadership lineup, including streamlining the management structure. Nissan will supposedly announce the switch on March 12. However, Reuters reported that the shakeup wouldn’t include Uchida leaving his post.

Uchida’s contract with the company expires in 2026, and he previously told reporters that he would step down if asked, but said that he wanted to right the ship before leaving. That won’t be easy now that the merger is dead.

The Japanese carmaker is bracing for a ¥80 billion ($534 million) loss at the end of March after Uchida unveiled a turnaround plan last year that failed to materialize. It’s also facing a substantial debt bill next year, according to the Bloomberg report.

Nissan’s struggles came into focus in the second half of last year. In the United States, signs of trouble first appeared in May when the automaker asked dealers to begin selling cars at a loss, which led to hurting dealership profitability by August. Earlier that same month, Nissan and Honda expanded an earlier partnership, which is still ongoing, to work on electric vehicles and software alongside Mitsubishi. Former Nissan CEO Carlos Ghosn called it a “disguised takeover” by Honda, and by all measures, he wasn’t far off.

By November, things were starting to get dire for Nissan. The company announced it would lay off 9,000 employees, sell a portion of its stake in Mitsubishi, and reduce global production capacity. It had already trimmed production of its popular Rogue crossover a few months prior. By the end of the month, some executives in the company told the press that Nissan had 12 to 14 months left to survive. That was three months ago.

Photo by: Nissan

A few weeks later, at the end of December, Nissan and Honda announced they were officially looking to merge, but the talks quickly deteriorated as Honda shifted direction, wanting to make Nissan a subsidiary instead of an equal partner—something Nissan didn’t want. The two officially called off the deal a few weeks ago. 

The struggling Japanese automaker is now on its own again, although it is open to other partnerships. Uchida said earlier this month that it would be “difficult to survive without leaning on future partnerships.”

The Taiwanese electronics maker Foxconn is interested in partnering with Nissan. But the Honda merger is not completely dead yet. Honda said it’s willing to reopen negotiations with Nissan. Considering Nissan’s current state, Honda could get its wish. Either way, the next few months will be difficult for Nissan and its embattled CEO. We should know more about the company’s direction early next month.