Tags: nissan | wrong | ghosn | right | fix

Nissan May Not Be the Only Wrong Ghosn Needs to Right

Nissan May Not Be the Only Wrong Ghosn Needs to Right
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Friday, 20 October 2017 07:17 AM

Even Superman has to recharge.

That's the nickname often foisted on Carlos Ghosn, chairman and CEO of the Renault SA-Nissan Motor Co.-Mitsubishi Motors Corp. alliance, for his track record of turning around struggling carmakers.

After folding in Mitsubishi Motors last year, the group overtook Volkswagen AG and Toyota Motor Corp. to become the largest automaker in the world.

So it's worth pointing out that the unfolding quality-control scandal at Nissan took place on his watch, long before Ghosn handed over the reins of the Japanese firm to current chief Hiroto Saikawa six months ago. Improper car inspections could go back as far as 20 years, local broadcaster NHK reported Friday.

Such improprieties should prompt Ghosn to pause his empire building and make sure the companies he currently oversees are actually humming along as smoothly as he'd like.

Nissan said Thursday it would halt production for about two weeks at six domestic plants after discovering uncertified technicians continued to carry out final inspections on assembly lines even after the company identified the violations, recalled 1.2 million cars and publicly apologized for the misconduct.

Nissan's six shuttered plants produce: 1,000 cars/day

I initially cheered Nissan's swift response, explaining it could serve as an example of how to artfully handle a mishap so long as nothing else came out of the woodwork.

Something did.

It's one thing to make an error and fix it, but it's another to resume the very same behavior after being caught. This suggests there's a larger problem.

Saikawa blamed the transgressions on a communication gap between top management and the shop floor, a familiar theme that's popping up at Kobe Steel Ltd. and other Japanese manufacturers whose lower-level employees are accustomed to following orders. That's a cultural issue and isn't something that can be fixed overnight.

The same problems could be pervasive across the alliance, especially considering the pressure on employees to meet ambitions stemming from another of Ghosn's nicknames -- "Le Cost Killer." As Nissan's CEO, Ghosn boosted the carmaker's operating profit margin to 6.5 percent in 2016 from negative 1.6 percent in 2008.

It's understandable Ghosn might have turned more of his attention to the alliance's most recent member, Mitsubishi Motors, in which Nissan took a 34 percent stake last year after a fuel-economy scandal damaged earnings.

But perhaps it's time to slow down a little and take stock of the portfolio. There's nothing to say there aren't other problems festering beneath the surface yet to catch Superman's eye.conglomerates. She previously was a reporter at Quartz and the Wall Street Journal.

  1. Saikawa isn't by any means an outsider. He's been at Nissan since he joined from Tokyo University back in 1977. 

This column does not necessarily reflect the opinion of Bloomberg LP and its owners.

Shelly Banjo is a Bloomberg Gadfly columnist covering industrial companies and

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Even Superman has to recharge.That's the nickname often foisted on Carlos Ghosn, chairman and CEO of the Renault SA-Nissan Motor Co.-Mitsubishi Motors Corp. alliance, for his track record of turning around struggling carmakers.
nissan, wrong, ghosn, right, fix
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2017-17-20
Friday, 20 October 2017 07:17 AM
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