Reference no: EM131791299

Please write up 5 pages about negotiation conflict.

The case article is below,

Nissan is suspending car production for the Japanese market after admitting unauthorised workers were certifying vehicles even after discovery of malpractice at the group in a deepening of the inspection scandal. The suspension comes a day after Mitsubishi, which is part of the Renault-Nissan Alliance, pledged to make regaining public trust its “highest priority” and follows admissions by Kobe Steel of data falsification that have cast a cloud over corporate Japan. About 34,000 Nissan vehicles, most of which are yet to be sold, are to be inspected again at a cost estimated to be less than ¥1bn. This month, the carmaker was forced to announce the start of a recall of nearly 1.2m vehicles produced for the domestic market in the past three years after it was revealed that uncertified technicians carried out final inspections. Nissan forecast that the recall could cost ¥25bn before Thursday’s announcement. The company said that even since then, and after introducing an initial set of corrective measures, unauthorised workers had still carried out these checks at some plants. Hiroto Saikawa, Nissan’s chief executive, said in Yokohama on Thursday: “We took countermeasures and we resumed production. People trusted these countermeasures we had taken and customers bought our cars and we betrayed their trust. This is a very significant problem.” Two former Nissan executives said the original issue may have gone unreported for so long because some Japanese workers feel it reflects badly on them to alert supervisors to problems. Mr Saikawa admitted there was a significant “communication gap between the shop floor and the management” that had allowed these questionable practices to become something of a norm, and pledged re-education of workers to eliminate bad habits. “If I see any weakness, I am ready to take drastic measures,” he said. “This is my job, which is imminent, and I am going to lead it.” The inspection scandal is the first big test for Mr Saikawa since he took over as chief executive in April. He said the company will suspend production of vehicles for the Japanese market while inspection lines are reconfigured and the number of final inspectors are increased. All six facilities operated by Nissan and its Nissan Shatai affiliate are expected to be back up and running within two weeks, although some factories may be upgraded faster than others. Japanese regulations require additional certification for the domestic market that is not needed for export models. Nissan has said the affected models have no safety issues. Asked what contact he had with Carlos Ghosn, his predecessor and chairman of Nissan and the Renault-Nissan Alliance, Mr Saikawa said he would not go into details but added: “As a CEO, the chairman trusted me to take care of this.” Scrutiny of Japan’s corporate governance practices has picked up since October 8 when Kobe Steel admitted falsifying inspection data on metals used by more than 500 customers in the manufacture of aircraft, rockets, cars, trains and nuclear plants. On Thursday, Toyota confirmed that aluminium used in some of its vehicles was safe, but it was still checking parts from suppliers that used material from Kobe. Mitsubishi’s chief executive made a similar statement a day earlier. Nissan’s own troubles come the year after Mitsubishi was found to have falsified fuel economy data in its vehicles.