The Nov 19, 2018 arrest of Nissan Motor's top executive, Carlos Ghosn, on a litany of charges of financial wrongdoing, dominated the news headlines for most of 2019. The Brazilian-French-Lebanese was to spend a total of 108 days in jail before being allowed out on bail of 1 billion yen.
Then on Dec 29, 2019, Ghosn, with assistance from several paid operatives, gave his watchers the slip, being spirited away from his Tokyo residence and making his way to Kansai International Airport, where he fled the country aboard a Turkish-registered private jet. He has since taken up residence in Lebanon, where he holds citizenship, and which does not have an extradition agreement with Japan.
Ghosn had a reputation as something of a miracle worker, and Nissan, at the time of his arrival in 1999, was certainly in need of a miracle. Following the merger of French automaker Renault with Nissan that same year -- in which time Renault acquired a 36.8% share of Japan's number-two automaker -- Ghosn moved to Tokyo to assume the post of CEO. He ruthlessly cut costs, shutting down five plants and dismissing over 20,000 workers -- but brought the company back to profitability and reached all the goals of the company's revival plan within the projected three years.
Under his direction the company was to pioneer the Leaf, an electric vehicle that has enjoyed strong demand. Nissan also acquired a 34% share of Mitsubishi Motors.
The airing of his Ghosn's alleged financial misdeeds and his "great escape" from justice humiliated Japan's legal authorities and constituted a major blow to Nissan's prestige. To add insult to injury, Shukan Jitsuwa (Dec 10) reports, the economic downturn caused by the coronavirus pandemic has also impacted severely on auto industry sales. According to the report of consolidated earnings for the first half of the 2020 business year (April-September), Nissan's global sales had declined by 38.2%, and the company posted an overall deficit.
Nevertheless, sales during the second quarter (July-September) managed an uptick from the disastrous first quarter, and the performance forecast was revised to give a less gloomy picture. When Nissan CEO Makoto Uchida, moreover, announced the company expected to return to profitability in 2021, the value of Nissan shares posted a healthy increase.
"UK Prime Minister Boris Johnson announced that the target date for phasing out gasoline- and diesel-powered vehicles would be moved forward to 2030," a motor industry trade journalist tells the magazine. "In the U.S., the new Biden administration is also expected to encourage sales of EVs, and this will put Nissan, a specialist in electric models, in a better position worldwide."
In Japan, Prime Minister Yoshihide Suga has also been calling for reductions in carbon emissions, which should give Nissan models an added boost in domestic sales. As the world's third largest producer of motor vehicles, Japan's recovery should also undo the stigma of the Ghosn scandal.
One thing holding back demand, the aforementioned journalist notes, is that many of Nissan's current domestic models date back about 10 years from their initial launches, and are continuing to be produced with only minor changes.
"They can't compete with Toyota," he says. "But looking at the company worldwide, Nissan has numerous models sold only in foreign markets, and some of them may have greater appeal than the ones it's now selling in Japan. I can't figure out why Nissan doesn't sell them here."
Nissan may be reluctant to market certain foreign models here due to such factors as their size, suitability to Japanese road conditions and the costs of shipping to Japan, among others. But if there's anything Nissan needs right now, the writer concludes, it's solutions that come from thinking outside the box.© Japan Today