Having already gone through a bankruptcy scare in 1999, Nissan is back in crisis as it looks for an anchor investor to help it survive a pivotal year. This comes as longtime partner Renault is selling shares in the company, according to Financial Times.
The publication quoted two sources as saying that Nissan is on the hunt for a “long-term, steady shareholder such as a bank or insurance group” to replace some of Renault’s equity holding, while it finalises a new electric vehicle partnership with Honda it signed in March. “We have 12 or 14 months to survive,” said a senior official close to Nissan.
The company has reportedly stepped up partnership discussions with its cross-country rival on EVs and next-generation software-defined vehicles (SDVs) in response to stiff competition from Chinese rivals, as well as uncertainty in the US now that divisive former president Donald Trump has been reelected.
Nissan has apparently not ruled out having Honda buy some of its shares, with “all options” on the table on the back of declining sales in both China and the US. Financial Times also cited people close to Renault as saying that the French carmaker is willing to sell a portion of its Nissan shares to Honda as part of its alliance restructuring. One of those people added that a stronger relationship between the tow Japanese firms could “only be a positive” for Renault.
Both Nissan and Honda have downplayed the possibility of a capital tie-up since a deeper partnership on SDVs was announced in August, with one of the publication’s sources saying that Honda buying a stake remained a “last resort.”
The two companies declined to comment when reached by the publication, although Nissan added: “The partnership with Honda is strategically very important, and we hope to accelerate the realisation of the results of our activities through regular progress at the management level of both companies.”
A more immediate concern is the search for an anchor investor while it continues to bleed money. The turmoil has attracted investments from Singapore-based Effissimo Capital Management and Hong Kong’s Oasis Management, both of which have previously targeted firms like Toshiba and Nintendo.
News of the company in crisis comes just weeks after it reported a nine billion yen (RM262 million) loss, leading to it cutting some 9,000 jobs and scaling back global production by 20%. The company also admitted to misreading the growing demand for hybrid vehicles in the US and is now planning a series of key product launches in the coming months and years. “This is going to be tough. And in the end, we need Japan and the US to be generating cash,” said the aforementioned senior official.
Renault reduced its stake in Nissan last year amid infighting over unequal shareholding and voting rights – the company held 43% of Nissan while the latter owned only 15% of the French company and lacked voting rights.
A capital recalibration cut Renault’s stake in Nissan to just under 36%, which it has continued to whittle down; Nissan also gained voting rights for its stake in Renault. Nissan also holds a 34% stake in fellow alliance partner Mitsubishi – which is also involved in the partnership with Honda – but plans to divest up to 10% as part of its emergency turnaround measures.
Renault is not directly involved in talks with Nissan and Honda, but sources said it could be open to joining in response to Chinese competition. The company denied any discussions in a statement, however, saying only that it was supportive of a “potential win-win between Nissan and Honda.”
Sources also said the outcome of the Nissan-Honda partnership would present a test case for how smaller companies forging technology and regional partnerships could survive the industry upheaval, as opposed to mega-mergers like Stellantis. “Is bigger really better? Or is the partnership model better?” asked the senior official, adding that pursuing scale would lead to inefficiency after a certain point.
A partnership between all four companies would make sense, sources noted. While Honda and Nissan are both focused on their key Chinese, US and Japanese markets, adding Renault would bring Europe into the mix, while both Renault and Honda are drawn to Mitsubishi’s strength in Southeast Asia and its plug-in hybrid technology. For its part, Mitsubishi said “we are currently exploring all possibilities and are eager to co-operate in areas where we can leverage our strengths,” but added that nothing has been finalised yet.
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Doubt any non-Japanese dares to go in after the Carlos Ghosn issue…
Padan mukak to Nissan for constantly backstabbing their partners & saviours. They wrecked Mitsu by airing all its troubles then come and bought over their shares for cheap like a pirate. And that was before they backstab Renault thru an exec pressure campaign to force the French in selling back their Nissan shares also for cheaps. Not to forget the drama where they sent their saviour CEO into prison before he finalised his turnaround plan for Nissan that might have prevented this situation today.
So Nissan deserves no help, they deserve all the troubles & crisis they see today. The brand that made my bayside blue R34 GTR is not the same today. Its the end RIP Nissan!
Wow, u are well versed in this background. Steady
The Chinese always waiting to Buy
Yes. I remember they sent Carlos to jail. What a bunch of losers
That is very true.
We have China car now, more bang for buck. Nissan close shop or not don’t really matter.
Tan Chong …better close shop…join nephew Anthony of Grab in e hailing business.Nissan will need another ‘Geely’ to bail them out like Protong.
easy peasy, nissan has history and want money, chinese companies have money and want to collect legacy brands to further develop their technologies. the only thing they need to do is kowtow to the chinese, like last time the chinese used to kowtow during the japs invasion
Nissan having a distributor in TCM sure does not help their cause.
Ultimately, your sales channels need to perform.
its high time, the industry goes through consolidation. too many automakers and too many brands. Japanese brands are facing competition just like Chinese brands and European brands are. Fairgame.
kinda felt, the disaster happening to Nissan is utter retaliation by outside market, for Nissan convicting Carlos Ghosn unfairly. i mean, when your looking for outside partners, or any partners, everyone is on edge thinking they’d be backstabbed by Nissan board anytime with Government interference. No trust at all. better to wait for it to bankrupt and liquidated and buy assets over rather than a partnership. A takeover in assets and assembly line instead. If renault were smart, theyd bandwagon with the Chinese, what nonsense is this that theyd prefer the Japanese because at the end of day, China has a larger market.
With this piece of news, it would be a concern to purchase a Nissan car right now
nissan Kics 2017 just introduced by ETCM will not sell now (it wont sell much anyway)
Carlos Ghosn = GTR, Z cars, Murano
before and after all mediocre
Nissan deserves to go under for assasinating their saviour
there is a reason why….
No person shall be elected to the office of the President more than twice, and no person who has held the office of President, or acted as …
Ghosn already said loud and clear what’s the problem within Nissan.
This company is against merit and performance. Their company culture is to promote staff who have been sitting there the longest, and to the brown-nosers that the management favour.
When Ghosn promoted young intelligent staff that performed and helped the company generate revenue, the “seniors” in Nissan were unhappy with it because the old-timers were upstaged by younger guys, and the ball-carriers don’t get to makan gaji buta.
Nissan would rather destroy Ghosn and eliminate him than to transform the company.
This is Nissan’s karma for having a useless company culture of cronyism, sycophanty and incentivizing poor performance.
no wonder ngam with tan chong…
The renegade Japanese directors and execs at the time started a campaign of character assassination against Ghosn. The ousting of Ghosn just as he started to enact plans to strengthen Nissan really came back to bite those directors and execs.
it is the same culture of most/all Japanese companies, to be honest. Seniority overrule everything else. Stubbornness is the problem with the Japanese.
Karma finally caught up with Nissan’s Japanese board of directors after all their shenanigans over the years, starting from the character assassination of Ghosn in order to oust him to downgrading Mitsubishi as basically Nissan’s subsidiary.
Honda will suffer if they partner this backstabbing Nissan.
Like TESLA, Apple, Wallmart, IBM, Amazon etc, the only one that can save a dying company to be come one of the richest company in the world is China. If China’s government likes you, you will be be rich overnight. Ask Elon Musk.Honda will not make much difference to the fate of Nissan.
No surprise here. How to get more customers if continue to sell old model like Kicks here.