Nidec's Kaida pledges to sell low-profit units, invest in AI

Nidec's announcement follows an accounting scandal that wiped off a third of its value and led to more than ¥1.1 trillion ($6.9 billion) in write-downs and charges. The leadership change that brought Michio Kaida, formerly chief technology officer, into the CEO role was described as controversial and preceded the disclosure of these financial issues. Kaida, who replaced Mitsuya Kishida this week, is now seeking to restore investor trust by returning to the company's origins as an enterprise.

The plan centers on divesting low-profit units like household appliances and automotive motors while allocating resources to AI, chips, and energy businesses. This shift toward data center equipment, power generation, and energy storage systems is intended to return the world's largest maker of precision motors to growth. The move appears aimed at staving off delisting or a hostile buyout, though the outcome likely hinges on how successfully the company can execute these divestitures and investments amid the fallout from the accounting irregularities.