Nissan Just Had Its Shareholder’s Meeting: Things Went Really Bad
Nissan has troubles on many fronts. As such executives facing an angry mob just goes with the current state of things which is really bad. Facing the music, Nissan executives assembled their yearly shareholder’s meeting. It tried to soften the blow by giving details about its new EV Ariya crossover. The Ariya will be unveiled to the public on July 15. But with the coronavirus swirling around everywhere this was not your typical shareholder’s meeting. And Nissan’s dire position combined with angry shareholders inevitably meant things went really bad.
Under 300 people were allowed to attend in Yokohama. Masks were required partially to cover angry faces. Nissan did not provide lunch as has been customary in years past. The whole affair was unceremoniously cut off in under two hours.
There’s a lot to be angry about when you’re flailing the way Nissan is
Shareholders weren’t there for happy proclamations and news of more EVs. They wanted their voices heard. Director’s compensation and the company’s revival plan were just some subjects. The scandal around former CEO Carlos Ghosn, souring relations with alliance partner Renault, and other complaints were heard. After all, there’s a lot to be angry about when you’re flailing the way Nissan is.
One shareholder was upset about Renault’s stake in Nissan. It owns 43.4% of Nissan. He said it was bad for Nissan because French people “excel at art” but are “weak” at business. Ouch! There was more.
Another shareholder said Nissan’s plans for recovery came too slowly. He described Nissan’s new management as fragmented, indecisive, and uninspiring. “What you need now is top-down strong leadership,” he said. “You shouldn’t just spend time on democratic discussion. We need dictatorship,” the shareholder said. “Ironically, when Mr. Ghosn arrived at Nissan, in five or six years he made recovery a reality. That’s what Nissan needs.”
Carlos Ghosn was the subject of much discourse
Carlos Ghosn was the subject of much discourse. A shareholder expressed favoring Ghosn and his management abilities. Another said Nissan has a credibility problem over the whole Ghosn affair. Ghosn was arrested in 2018 for financial misconduct. Last year he escaped to his native Lebanon.
According to Automotive News, some shareholders felt that Japan’s Ministry of Economy, Trade, and Industry, was part of the reason for Ghosn’s arrest. To many, it looked like a conspiracy between Nissan and the Japanese government. “That’s the theory, which is understood as a convincing theory among the public,” one shareholder said.
Relations between parent company Renault and Nissan have always been strained
Nissan has had a hard time supporting its reasons for arresting Ghosn. Relations between parent company Renault and Nissan have always been a bit strained. Nissan didn’t like Ghosn’s control over choosing Nissan directors and executives. It wanted more autonomy. At the time of his arrest, Ghosn had made known his plans to tighten the control he had over Nissan.
CEO Makoto Uchida defended his recovery plan released last month. It charts recovery within four years, a 5% profit margin, and increasing global sales by almost 10% to 5.38 million vehicles. “What we showed you, as a forecast, is the level that is feasible, achievable, a level that we can deliver,” Uchida said. “We are seeing better results, but it will take time.” Unfortunately, Nissan doesn’t have a lot of time.