Nissan CEO Acknowledges Brand’s Future Depends on External Investment

Nissan has faced significant challenges over the past few years, particularly in 2024. During this time, senior executives at Nissan expressed concerns about the company’s future, suggesting that the brand may not make it through 2025. The company’s CEO, Makoto Uchida, has since reiterated that Nissan’s survival is contingent on securing external investments.
In recent discussions about potential partnerships, the prospect of a merger between Nissan and Honda attracted considerable attention. However, this idea appears to have faltered, primarily due to Uchida’s worries about Nissan’s autonomy. He articulated these concerns in a news conference, questioning whether Nissan would be able to maintain its independence if it were to become a subsidiary of Honda.
Despite these setbacks, Honda is still considering investing in Nissan. Such an investment could pave the way for additional collaboration among Nissan, Mitsubishi, and Foxconn. If Honda proceeds with an investment, Uchida might have to resign as CEO. He has indicated that he would not obstruct the decisions made by Nissan’s nomination committee, board, or shareholders. This committee is expected to convene soon to determine the next course of action. Should Uchida leave his position, Nissan’s Chief Financial Officer, Jeremy Papin, may serve as interim CEO until a permanent replacement is found.
Nissan’s financial difficulties have been well documented, especially as the automaker reported a drastic shift from a projected net profit of $2.5 billion to an estimated net loss of $536 million in the last fiscal year ending in March 2024. Several factors contributed to this downturn, including a staggering 24% decline in sales in China during 2023, with projections indicating that the situation may not improve in 2024. To mitigate these losses, Nissan has reduced its global production capacity by 20% and laid off around 9,000 employees. Additionally, Uchida has taken a significant pay cut, halving his salary in light of the company’s financial woes.
Compounding Nissan’s troubles are potential tariffs announced by the U.S. government on imports from Mexico, where Nissan manufactures several models. Currently, about 300,000 units are scheduled for export to the U.S. before the close of the fiscal year.
Mitsubishi, another player in the automotive industry, is also reevaluating its partnership with Nissan. After discussions about forming a joint holding company with Honda and Nissan fell through, Mitsubishi is shifting towards reducing its dependence on Nissan. Notably, the upcoming model of the Mitsubishi Outlander, the brand’s most popular vehicle in the U.S., will not utilize a platform shared with Nissan-Renault, breaking from the previous arrangement where it was based on the Nissan Rogue.
As the automotive landscape evolves, the connection between Nissan, Mitsubishi, and Renault grows increasingly precarious. With the Mitsubishi Outlander scheduled for a redesign by the 2027 model year, the transition to a new platform is unlikely to occur swiftly.
Despite the challenges ahead for Nissan, the company’s leaders are at a crossroads, contemplating their next moves amid mounting pressures in the automotive market. The future of Nissan will depend significantly on strategic decisions made by its executives and any potential shifts in partnerships.