Thinking better of trying to rescue Nissan, BMW under investigation, RIP Car2Go, and the sweet, sweet release of death. All this and more on The Morning Shift for this Boxing Day, Thursday, December 26, 2019.
1st Gear: On Second Thought
Back in October, Nissan shuffled its executive team to lead the turnaround for the troubled automaker post-Ghosn. That included making Jun Seki, described as “the engineer who currently the senior vice president in charge of performance recovery,” as vice-Chief Operating Officer.
That slew of appointments officially took effect December 1. It’s been less than a month, but Seki has already bailed.
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.
Seki, it should be noted, was passed over for the CEO role at Nissan. He denied that he’s leaving because of that, but “did not elaborate,” according to Reuters. He also hinted he’s taking less money at his new job.
Reuters also references some chemistry issues among the new leadership team:
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.
People leave jobs for all kinds of reasons and sometimes it’s not a bad thing, especially at a company that needs a change of culture. Other times its a symbol of profound dysfunction within the company or a lack of direction going forward. Only time will tell which category this departure belongs, but, if nothing else, this doesn’t exactly inspire confidence in Nissan’s rebound.
2nd Gear: BMW Under Investigation For Fraudulent Sales Figures
It’s a Christmas Eve scoop from the WSJ:
The Securities and Exchange Commission has opened an investigation into whether German luxury car maker Bayerische Motoren Werke AG manipulated sales figures, according to people familiar with the matter.
The regulator is looking into whether the Munich-based auto maker engaged in a practice known as sales punching in the U.S., the people said. Sale punching occurs when a company boosts sales figures by having dealers register cars as sold when the vehicles actually are still standing on car lots.
A few months ago FCA settled a similar case with the SEC for $40 million. Chump change for a global automaker. I’m sure BMW is shaking.
3rd Gear: Just When You Thought The Ghosn Mess Couldn’t Get Any Worse
Here’s a fun one from Auto News:
A California dealership group has filed suit against Nissan Motor Co. and two subsidiaries, saying “a culture of corporate corruption and greed” at the Japanese carmaker forced the plaintiffs into a “fire sale” of two popular dealerships to “cronies” of indicted former Chairman Carlos Ghosn.
Also named in the suit, filed Monday, is Trophy Automotive Dealer Group LLC, which is owned by Nasser Watar. Watar is a business partner of Saudi billionaire Khaled al-Juffali, a central figure in one of the breach-of-trust indictments brought against Ghosn in Japan.
Saudi billionaires, cronies, an alleged $14.7 million bribe to settle losses from a currency swap under the table, and somehow a bunch of people buying dirt cheap Nissans.
This is the perfect Ghosn lawsuit: corrupt as hell with the whiff of international intrigue while also being unspeakably lame.
4th Gear: Everyone Got All Excited About Carsharing For Nothing
Remember carsharing? Zipcar came along and that was neat, and then a dozen carmakers inexplicably thought “we should do that!” and they’ve all been massive failures.
The most recent such failure was Daimler’s effort to make Car2Go a thing, which has now shut up shop in North America. The Financial Times has a bit of a post mortem on North American carsharing that’s worth a read:
But 10 years later, many of these projects are in retreat, foiled by underuse in medium-sized cities, the emergence of rivals such as Uber, Lyft and China’s Didi Chuxing, the competing pressure to invest heavily in electric vehicles and a miscalculation over the enduring lure of the personal car.
A few weeks before DriveNow, BMW’s joint-owned car-sharing service, announced it would withdraw from London, its chief executive made a point of talking down the earning potential of such projects, in which the carmaker, alongside Daimler, had pledged to invest more than €1bn just 10 months ago.
“Not every trend is relevant for the BMW Group,” Oliver Zipse said in Munich, stressing that the company would focus instead on its core competency: manufacturing premium cars.
That last quote feels like a good summation of the decade in cars: not every trend is relevant to carmakers, even though they seem desperate to make it so. As the FT article notes, just because carsharing is a service that uses cars doesn’t mean automakers are well-positioned to run them.
5th Gear: I Hate Being Alive
Tesla Inc shares traded above $420 on Monday, more than a year after Elon Musk tweeted he had “funding secured” to take the electric car maker private at that price, only to later give up under investor pressure and regulatory concerns.
“Whoa … the stock is so high lol,” Musk tweeted on Monday, after Tesla shares crossed the $420 mark.
The number 420 is closely associated with marijuana as a slang for the consumption of cannabis. It also refers to cannabis-related celebrations that take place annually on April 20.
Reverse: Preston Tucker Dies
Neutral: What Was The Silliest Automaker Fad From This Decade?
I don’t want to talk about Nissan/Ghosn any more than I have to, so let’s talk about something else.
For this question, I’m thinking about misguided business fads everyone seemed to jump on a la carsharing, but feel free to interpret the question as broadly as you’d like.