Nissan on the Brink: CEO Confirms Automaker’s Survival Depends on Investors

Nissan CEO Makoto Uchida admits the company cannot survive without external investment. With mounting losses and market challenges, Nissan faces an uncertain future. Read more about the crisis.

Nissan’s long-standing troubles have finally been acknowledged at the highest level. The company’s CEO, Makoto Uchida, has publicly stated that the automaker cannot survive without outside investment. Expert forecasts paint an even bleaker picture: Nissan is now expecting a net loss of $536 million by the end of its fiscal year in March—despite initially projecting a $2.5 billion profit in May 2024.

The reasons for the crisis are clear. The company’s sales in China, one of its largest markets, plummeted by 24% in 2023, with no signs of recovery. In North America, Nissan faces outdated models, a lack of competitive hybrids, and heavy reliance on dealer incentives that eat into its profits. In response, the company has already cut global production by 20% and laid off 9,000 employees.

Adding to Nissan’s woes, the Trump administration has been threatening new tariffs on cars imported from Mexico—where a large portion of Nissan’s U.S.-bound vehicles are produced. If implemented, these tariffs could further squeeze the struggling automaker’s already thin margins.

Nissan explored a potential merger with Honda in late 2024, but the deal fell through. According to Uchida, the company was unwilling to sacrifice its independence in such an agreement. However, Honda hasn’t walked away entirely—it is still considering investing in Nissan, though under one major condition: Makoto Uchida must step down as CEO.

Leadership changes are already on the table. Insider reports suggest that Nissan’s CFO, Jeremy Papin, could take over temporarily if shareholders decide to replace Uchida. But analysts are skeptical that a leadership swap alone will be enough to turn the company’s fortunes around.

The market is losing faith in Nissan’s ability to recover. Credit agency Moody’s has downgraded Nissan’s rating to “junk” status (Ba1) due to its deteriorating financial outlook and uncertain recovery strategy. With a negative outlook still in place, the situation remains precarious.

Unless Nissan secures substantial investment and dramatically reshapes its business, its future remains highly uncertain. The company is still afloat for now, but without a bold new direction, its chances of bouncing back are fading fast.

Source: autoblog.com