Mitsubishi Motors to Launch Merit Pay for Execs

Mitsubishi Motors Corp. will roll out its new management structure on Wednesday as it scraps the company’s fixed-salary system for senior executives and introduces a merit-pay scheme, The Nikkei reports.

The changes are part of a plan to streamline operations and pull MMC out of its latest vehicle certification crisis. The company is being reorganized by Nissan Motor Co. which acquired a controlling 34% stake in October.

Renault-Nissan CEO Carlos Ghosn will add the title of MMC chairman and co-CEO. He will share the latter title with Hiroto Saikawa, Nissan’s chief competitive officer.

The restructured MMC will gain a chief operating officer, chief financial officer and chief performance officer to define corporate performance goals and keep the company on track to achieve them, according to the report.

The company also will reduce layers of management in a bid to reduce bureaucracy, clarify accountability and accelerate decision making. Thus the company will eliminate assistant and deputy management positions in January. Currently, The Nikkei says, it takes five steps for a report from a product development section head to reach the company’s executive vice president.