Nissan’s Troubles Keep Mounting and Now Upheaval At Infiniti, Too
Nissan’s luxury brand Infiniti has seen sales continue to fall in recent months. Now it has announced that Karim Habib, who was head of Infiniti design for the last two years will be replaced by Taisuke Nakamura, who has overseen Nissan’s concept car designs as well as its global design strategies.
This follows in the wake of major restructuring within Infiniti and Nissan to turn around the company after the abrupt departure of Carlos Ghosn. You’ll remember that Ghosn was imprisoned in Japan over accusations by the Japanese government of fraud and theft he carried out. The Ghosn incident has been ongoing since November and has been both a curiosity and an embarrassment for Nissan.
But there’s more. Besides the distraction and disruption the Ghosn arrest has created, Nissan is facing class-action lawsuits in the US over its admission Ghosn committed securities fraud. Originally this revelation by Nissan was part of its attempt to explain Japan’s abrupt arrest of Ghosn. Nissan has had to pony up hundreds of millions of dollars to defend itself over the US suits as fears mount similar suits could be on the horizon for Nissan inside of Japan.
A statement from Nissan says it takes the charges “extremely seriously and express its deepest regret for any concerns caused to its stakeholders.” It vows to make more accurate disclosures about company business going forward. But, besides the money drain, Nissan could also be facing US and Japanese regulatory penalties.
Nissan Sales Dive
Nissan has seen sales dive as its cars and trucks continue to age. The company has taken some major steps to turn Infiniti around including pulling the brand entirely from the European market, moving its brand headquarters back to Japan from Hong Kong, and building a new design language centered around their new all-electric cars.
The US is Infiniti’s largest market, where sales for 2019 have dropped over 13%. In total Infiniti has sold 71,718 cars this year in the US.
Denver Data Center Crash
On top of these problems is the Nissan Group’s Denver data center crash that paralyzed the company last week. A power outage caused the crash. Nissan lost the ability to process new customer purchases which, in turn, caused lost sales. Cars are ordered through the system, rebates are processed, and recall organization and warranty claims are tracked and processed, among the many other company functions it processes. The crash also stopped factory car lines. Needless to say, Nissan was almost unable to function at all last week, with repercussions continuing to cause headaches this week. The power outage is affecting dealerships throughout the US, Canada, and Mexico, too.
All of these issues are stimying Nissan’s daily business on the heels of its move to Nashville, Tennessee from Gardena, California, in 2006. Many employees did not make the move. As a result, there were some hiccups and it took a while for corporate business to smooth out.
Nissan’s financial problems are exacerbated by Renault’s 43% ownership, and that it has limited clout within the organization even though it sold 5.56 million cars to Renault’s 3.88 million cars. The French government owns over 15% of Renault.