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Nissan top executive Seki to resign in blow to turnaround plan

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12/24/2019 | 05:12pm EDT
Nissan Motor executive officer and vice-COO Jun Seki  speaks during a news conference at Nissan Motor headquarters in Yokohama

YOKOHAMA, Japan (Reuters) - The executive tasked with leading a recovery at Nissan Motor Co Ltd said he had decided to resign just weeks into his new job, a move that could disrupt the automaker's push to turn the corner on scandal and slumping sales.

Jun Seki, Nissan's vice chief operating officer and a former contender for chief executive, told Reuters he was leaving to become the president of Nidec Corp, a Kyoto-based manufacturer of automotive components and precision motors.

He will likely depart in January after three decades at Nissan, including a stint heading its China business.

"I love Nissan and I feel bad about leaving the turnaround work unfinished, but I am 58 years old, and this is an offer I could not refuse. It's probably my last chance to lead a company too," he said in a brief interview.

"It's not about money. In fact, I will take a financial hit since Nissan pays us well," Seki said. He declined to elaborate further.

Nissan and Nidec declined to comment.

Seeking to roll back some of the costly expansion under ousted chairman Carlos Ghosn, Nissan has embarked on wide-ranging turnaround plan.

That plan, which began in April, is now on track to generate a cumulative few hundred billion yen in cost cuts and operational efficiency gains by the year to March 2022, according to two Nissan sources who spoke on condition of anonymity. One hundred billion yen is roughly equal to $915 million.

Adding to concerns about disruption among Nissan's top management, the sources said that Seki, Chief Operating Officer Ashwani Gupta and Chief Executive Makoto Uchida have so far failed to gel as a team after being named to their posts in October.

They officially took over on Dec. 1.

"There was no instant, cohesive chemistry achieved by those appointments," one of the sources said.

Gupta and Uchida were not immediately available for comment.

Seki's resignation could further complicate Nissan's relationship with top shareholder Renault SA. Seki recently worked in Paris for a year and was seen as relatively close to the French automaker.

PERSUADED IN THE END

Asked if he was leaving Nissan because he was passed over for the role of chief executive, Seki said that was not the case but did not elaborate.

He and Uchida, most recently the head of the China business, had been seen as top contenders for the CEO job. Reuters reported in September that Uchida was seen as more favored by Renault.

Before being named vice-COO, Seki was a senior vice-president charged with leading the turnaround.

Nissan has been profoundly shaken over the last year, first with the downfall of long-term leader Ghosn, who is now awaiting trial on allegations of financial misconduct that he has denied. Former Chief Executive Hiroto Saikawa then left in September.

One of the sources said Seki was contacted by a headhunter about a job at Nidec in April, after he returned from a year working in Paris.

Nidec's 75-year-old chairman, the brash and confident Shigenobu Nagamori, has been searching for an eventual successor to lead and expand its business.

Nidec, which sees electric vehicles as a key driver of growth, has a 40% global market share in automotive electric steering motors and has said it wants to boost its share in electric vehicle propulsion motors.

After April, Seki had no additional contact with Nidec until the recruiter called him again on Oct. 8 when Nissan announced the new management team, including Uchida as CEO.

After that second call, Seki agreed to meet Nagamori - to turn down the offer, the source said.

"Nagamori talked Seki into accepting his offer in the end," the source said.    

(Reporting Norihiko Shirouzu; Additional reporting by Makiko Yamazaki; Editing by David Dolan and Edwina Gibbs)

By Norihiko Shirouzu

Stocks mentioned in the article
ChangeLast1st jan.
NIDEC CORPORATION 0.19% 10300 End-of-day quote.2.49%
NISSAN MOTOR CO., LTD. 0.38% 366.8 End-of-day quote.-2.68%
RENAULT -4.01% 17.208 Real-time Quote.-59.20%
THE GOLDMAN SACHS GROUP, INC. 0.81% 159.62 Delayed Quote.-30.58%
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