Turmoil in the auto industry comes in many forms. Disrupters range from outsiders trying to get a piece of the pie to insiders perpetrating unscrupulous acts.

The complex landscape and international alliances involving agencies from disparate industries make oversight that much more difficult.

One example of the latter has been unfolding for some time, and the intrigue spans the globe. Unfortunately for stockholders and employees, the controversy has personal consequences.

In their latest attempt to cut expenses and boost the bottom line, Nissan told 21,000 employees at its U.S. headquarters and three manufacturing facilities in Tennessee and Mississippi to plan for a two-day mandatory unpaid furlough in January. In the past few years, the company has cut travel expenses by 50 percent across the board and cut 10 percent of its workforce, amounting to a loss of 12,500 jobs worldwide. This comes in the wake of a drastically declining sales trend and global efforts to get their affairs in order.

Sliding U.S. sales have been felt by all automakers, and the National Auto Dealers Association predicts a half-million drop over last year. But Nissan has steadily underperformed these recent subpar numbers. In the first quarter of 2019, profits were down more than 98 percent from last year and didn’t improve much by last quarter, when profits were down by 70 percent.

U.S. sales fell by nearly 15 percent, while annual sales figures are much worse. This represents the third consecutive decline for Nissan. Operating profits were down 45 percent in 2018, with China and the U.S. representing the hardest-hit markets.

These numbers include Infinity, Nissan’s upmarket brand, whose annual sales were down 44 percent in the first half. To make matters more difficult, Nissan’s truck line, the hottest-selling automotive segment in the U.S., is overdue for a makeover, pushing sales even lower than their overall corporate average with a 21 percent decline in the first half of the fiscal year.

Problems at Nissan can be traced to the leadership with three separate individuals holding the CEO spot in the past three years. One of those, Carlos Ghosn, has been embroiled in legal problems stemming from financial misconduct allegations and was awaiting trial in Japan before taking a powder to Lebanon at the end of last year.

He’s accused of underreporting millions of dollars in salary, earmarking company funds for personal use, and transferring personal debt to the company. These are allegations he denies, although he has agreed to personally pay the U.S. Securities and Exchange Commission $1 million to resolve charges of concealing $140 million in retirement compensation from investors while Nissan will pay $15 million towards the same settlement.

Problems for Ghosn was arrested in Japan for financial crimes and released on $9 million bail before being arrested a second time on additional charges and posting another $4.5 million bail. Now, Japan has issued an arrest warrant for his wife for allegedly giving false testimony in court last April.

Ghosn’s career with Nissan started out strong when he was hired in 1999, at the same time Nissan and Renault formed an alliance. The two separate automakers make up a global group but maintain independence and Ghosn became CEO of both Nissan and Renault.

In the recent trend of joining forces among automotive manufacturers, in 2016, Mitsubishi joined the alliance as well.

Ghosn cut jobs and costs, closed factories, and increased output and profits, moving the alliance to the No. 2 spot in Japanm earning millions in salary, stocks and bonuses along the way. He traveled extensively on Nissan corporate jets, Gulfstream G650s that cost near $70 million to acquire and are generally more capable than most airliners, and he stayed at lavish homes paid for by the corporations he ran and which were purchased or rented on various continents for his personal use.

Turmoil within the Nissan-Renault-Mitsubishi alliance came to a head last year, when Renault entertained offers to join Fiat-Chrysler without consulting Nissan. That merger fell apart and F-C has recently announced a partnership with Renault competitor, Peugeot (PSA group).

Following Ghosn’s arrest in Japan, he was removed as CEO from Nissan and, shortly after, Renault, though the alliance reportedly remains strong as the industry invests heavily in electric and autonomous technology. The alliance, with Mitsubishi’s minority role, still will be run by a single leader but each will have a separate CEO.

The automotive corporate world is a complex and changing environment fraught with power, pitfalls, intrigue and occasional corruption, but failure is never imminent, don’t count Nissan out yet. One only needs to look to Jeep, nearly a footnote in the collapse of American Motors Corporation, resurrected to become the most profitable line in Fiat-Chrysler's U.S. sales lineup.

Eric and Michelle Meltzer own and operate Fryeburg Motors, a licensed, full-service automotive sales and service facility at 299 Main St. in Fryeburg, Maine. More than a business, cars are a passion, and they appreciate anything that drives, rides, floats or flies.

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