Nissan Motor announced a significant leadership shakeup on Wednesday, reassigning Chief Financial Officer (CFO) Stephen Ma to head its China operations starting in January. This move comes as the struggling Japanese automaker grapples with declining sales and implements a global restructuring plan. Jeremie Papin, current Chairperson of Nissan Americas, will replace Ma as CFO.
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Executive Shifts Amidst Financial Challenges
President and CEO Makoto Uchida is under immense pressure to revitalize Nissan, particularly in its crucial China and U.S. markets, where sales have slumped. The company recently reported a staggering 90% drop in half-year net earnings compared to the previous year, leading to a substantial reduction in its annual operating profit forecast.
To address these challenges, Uchida unveiled a comprehensive restructuring plan involving 9,000 job cuts and a 20% reduction in global production capacity. This initiative aims to slash costs by $2.6 billion by the end of the current fiscal year in March. Stephen Ma played a key role in communicating the details of this plan to analysts and investors.
Effective January 1st, Ma will transition to the role of Chairperson for Nissan’s China business. This strategic shift is part of a broader reshuffle within the executive committee. Concurrently, Christian Meunier, former CEO of Stellantis’ Jeep brand and previous head of Nissan’s Infiniti division, will return to lead Nissan Americas, succeeding Papin.
CEO Uchida emphasized that these leadership changes are designed to inject “necessary experience and urgency” into the company’s turnaround efforts. Further management restructuring is anticipated in April.
Ongoing Leadership Turmoil at Nissan
This latest reshuffle highlights the ongoing leadership challenges at Nissan, which has been plagued by instability since the 2018 arrest of former Chairman Carlos Ghosn and the subsequent unraveling of its partnership with Renault. The company has seen a series of high-profile departures, including CEO Hiroto Saikawa in 2019 and Chief Operations Officer Ashwani Gupta last year.
Ma, 54, boasts a long tenure with Nissan, starting in the U.S. division in 1996 and holding various financial positions within the group, including roles in its Chinese joint venture with Dongfeng. He assumed the CFO position in December 2019, shortly after Uchida became CEO. His departure from the CFO role was anticipated, according to reports last month.
Incoming CFO Papin joined the Renault-Nissan alliance in 2009 as a financial advisor and has led Nissan’s U.S. operations since 2021. He faces the daunting task of implementing the recovery plan and restoring financial stability. This challenge is underscored by recent credit rating downgrades from Moody’s and Fitch, citing concerns about declining free cash flows.
Investor Pressure and Future Outlook
Nissan is also facing pressure from activist investors like Effissimo Capital Management and Oasis Management, who have acquired stakes in the company and are known for advocating for changes in capital allocation and corporate governance. The company’s ability to navigate these challenges and successfully execute its turnaround strategy remains to be seen. This executive reshuffle represents a crucial step in addressing the company’s urgent need for stability and renewed growth.
