Nissan is facing another financial crisis, with operating profits shrinking by 90% in the first half of the fiscal year.
Once on the brink of closure in the late 1990s, the automaker is now looking for solutions to avoid repeating history.
This was reported by Autocar.
History of Financial Struggles
Nissan has faced similar challenges before.
In 1999, Renault stepped in and acquired 35% of the company, saving it from bankruptcy. A few years later, another Renault intervention kept the brand afloat.
Now, with Renault reportedly looking to reduce its stake, Honda has been named as a potential buyer by sources speaking to the Financial Times.
Nissan’s financial troubles have been exacerbated by aggressive discounts in key markets like the US and China during the first half of 2024.
In response, the company has announced several drastic measures:
9,000 job cuts worldwide.
A 20% reduction in global production.
CEO Makoto Uchida has taken a 50% pay cut to demonstrate leadership during the crisis.
Broader Industry Challenges
Nissan’s struggles reflect a broader trend in the automotive industry. Volkswagen is closing factories in Germany, citing financial pressures.
Meanwhile, Stellantis, the owner of brands like Peugeot and Opel, recently replaced CEO Carlos Tavares amid internal disagreements over his plans to cut several of the group’s 14 brands.
Despite the grim outlook, Nissan is determined to find solutions to avoid collapse and prevent a repeat of the dire situation it faced in 1999.
