Can New CEO Move Nissan Past Ghosn’s Shadow?Can New CEO Move Nissan Past Ghosn’s Shadow?

Ivan Espinosa's appointment as Nissan's new chief executive officer marks a pivotal moment for the company as it seeks to navigate recent challenges and revitalize its position in the global automotive industry either as an independent company, or as part of a tie-up with Honda.

Espinosa, born and raised in Mexico, is the first Mexican national to lead a global automaker.

Espinosa’s track record:

The decision to appoint Espinosa as CEO comes in the wake of significant challenges faced by Nissan, including declining sales, financial underperformance and the collapse of merger talks with Honda. Outgoing CEO Makoto Uchida resigned amid these huge challenges that developed on his watch. Uchida took the reins amid corporate upheaval after CEO Carlos Ghosn was broomed out for alleged financial misdeeds. Ghosn had built the company into a global automotive powerhouse, No. 1 in global sales, in an alliance with French automaker Renault and Japanese automaker Mitsubishi.

Being an insider and rising star inside Nissan helped Espinosa’s backing by the board. His long tenure at Nissan ensures continuity as the automaker’s restructuring goes forward. His background in product strategy positions him well to adapt Nissan’s offerings to evolving market demands, particularly in the EV sector, especially if Nissan’s future is independent with new equity investors instead of a full-blown tie-up with Honda.

Colleagues in Nissan’s U.S. operation and analysts describe Espinosa as an executive who has won respect internally over a long period of time.

“He’s a very passionate product guy,” says Christopher Richter, Japan auto analyst at brokerage CLSA. “I think it sends a good signal that Nissan wants to give product a higher priority because the Nissan brand has been drifting for a long time and not really standing for that much.”

"There are very big tasks ahead for Nissan as it figures out its best path forward for survival, and certainly Espinosa has a daunting task in front of him," says Ed Kim, president and chief analyst at AutoPacific. "We will soon find out his acumen for running an embattled automaker, including potentially taking the lead on a potential merger."

Potential Approach to a Honda Merger

The prospect of a merger between Nissan and Honda, announced by the two companies last December, is up for grabs. Earlier talks aimed at creating a $60 billion entity – the world’s third-largest automaker – were hindered by differences, including Honda’s proposal to make Nissan a subsidiary, which CEO Uchida resisted to maintain the troubled automaker’s autonomy.

“We can unlock a lot of possibilities,” Espinosa says, declining to comment specifically on restarting talks with Honda.

Espinosa’s stance on the merger is anticipated to be pragmatic, say analysts. For example, one U.S. Nissan executive speaking on condition of anonymity because they are not authorized to speak for the company, tells WardsAuto, “Whether Espinosa supports a full-on merger with Honda, or just advance the technology joint venture announced a year ago, both companies are going to benefit from cooperating, but there is little doubt that more U.S. jobs will fall away if it’s a merger because there’s a lot of duplication between Honda’s and our technology (and) research and development operations.”

Nissan Weaknesses Espinosa Must Address

Speaking at a press conference after being named CEO, Espinosa said he wants to investigate Nissan's entire strategy in North America.

Espinosa will have the opportunity to stock his senior management team. Other senior Nissan executives who are stepping down from their positions include Hideyuki Sakamoto, who oversees manufacturing and supply chain management, and chief technology officer Kunio Nakaguro, Nissan says.

The new CEO is under pressure to send signals to investors. The company saw a 78% year-on-year drop in operating profit and a net loss of $95.7 million in fiscal calendar 2024. Moreover, Fitch Ratings last month cut Nissan's rating to “junk.”