Nissan Motor co. is working on plans to replace its CEO as the Honda Nissan talks fell through the cracks. This also comes on the back of another report of poor set of earnings, persons in the know told Bloomberg.
Nissan directors are assessing interest in suitable candidates to succeed the company veteran Makoto Uchida, one of the sources told Bloomberg on condition of anonymity. Nissan refused to offer comments to the newswire.
Nissan shares rose 4.9% in Tokyo in morning trade. The company initiating Uchida’s departure suggests that the carmaker still has the capability to act in securing a partner, noted Bloomberg Intelligence analyst Tatsuo Yoshida.
Uchida, 58, told reporters earlier this month that while he was prepared to give up his position if asked, he didn’t want to step down before steadying Nissan’s business. He braced investors for an ¥80 billion ($536 million) net loss for the fiscal year ending in March, a far cry from the ¥380 billion net profit he was forecasting just nine months ago, the newswire noted.
Major credit graders have slashed Nissan's ratings to junk, on the back of two downgrades, just the previous week.
Uchida looked to Honda for help late last year, striking a tentative agreement to combine under a joint holding company. The carmakers called off those negotiations this month after disagreeing over terms.
Honda and Nissan executives said they would still continue a strategic partnership with a third Japanese peer, Mitsubishi Motors Corp., to collaborate on electric-vehicle batteries and software development. Uchida was clear-eyed during a Feb. 13 press conference about how pivotal tie-ups will be to Nissan’s future.
Nissan’s biggest shareholder and longtime alliance partner Renault SA was critical of the hard bargain Honda was driving over how their combination would be structured and praised Nissan for walking away. Renault has meanwhile sought to distance itself from the company, with CEO Luca de Meo saying China’s Zhejiang Geely Holding Group Co. may be a more natural partner than Nissan going forward.
Foxconn, approached Nissan about acquiring a stake in the company in December and said this month it was open to buying Renault’s 36% shareholding. On a separate note, American PE firm KKR has mulled a potential equity or debt investment to improve Nissan’s financial position, Bloomberg News reported earlier this month.