Nissan CEO Ghosn says no plans now to step down

June 22, 2012

Carlos Ghosn, chairman and CEO of Nissan and Renault, poses for a picture before an interview with Reuters in Tokyo June 22, 2012. — Reuters picTOKYO, June 22 — Nissan Motor Co CEO Carlos Ghosn said today he was not thinking of stepping down anytime soon, but Japan's No.2 automaker had succession plans in place to select the next chief from within its ranks.

Nissan shares fell more than 2 per cent today following a Bloomberg report that Ghosn, 58, was considering stepping down before the company's next mid-term business plan starts in about five years.

“Talking about stepping down in five years is frankly not a topic of particular actuality now,” Ghosn, who has headed Nissan since 2001, told Reuters in an exclusive interview in Tokyo.

“When you're CEO, you have to have two conditions: first, shareholders need to trust you and want you to head your company. The second is that you need to feel the motivation to do the job. So, as long as both are reunited, you continue to do the job. And today, they are reunited,” he said.

Nissan's current six-year business plan runs until March 2017.

Ghosn, one of the most visible chief executives in Japan and credited with turning a near-bankrupt Nissan into one of the world's most profitable car companies, noted that his mandate as member of Nissan's board was not up for renewal until June next year. He added he would be up for election for another 2-year term in 2015, at the end of which he would be 63.

“These kinds of things are usually discussed at shareholders' meetings where your mandate is being renewed ... so we still have time in front of us,” he said.

The Brazilian-born Frenchman, who has a triple role of heading Nissan, its French partner Renault SA, and the Renault-Nissan alliance, repeated his long-held stance that he would prefer a Japanese national to lead Nissan when he does come to resign. Both Nissan and Renault had a vast pool of talent from which to select his successor, he said, indicating there would be no external search.

Ghosn is the longest-serving CEO at a Japanese automaker after octogenarian Osamu Suzuki, who has led Suzuki Motor Corp since 1978.

Yen threatens Japan commitment

Despite a year riddled with supply chain disruptions, an historically strong yen and a teetering European economy, Nissan posted an operating margin of 5.8 per cent in the year to end-March thanks to brisk sales – outperforming domestic rivals Toyota Motor Corp and Honda Motor Co.

To boost profitability further, Nissan – like Toyota and Honda – is scaling down production in Japan, where a yen around 80 to the dollar has kept its domestic operations in the red.

In the latest move, Nissan said it would close one line at its Oppama factory, south of Tokyo, in July in a move that would reduce total production capacity in Japan by around 15 per cent to 1.16 million vehicles a year.

Ghosn repeated Nissan's commitment to keeping at least 1 million vehicles of capacity in Japan for now, but added that could change if the yen stayed at today's “unbelievably” strong levels.

“We are still keeping, as much as we can, to the 1 million commitment that we made, hoping that at a certain point in time, the headwinds represented by the strength of the yen will be a little bit less strong.” — Reuters