What happened to Nissan? And what happens next if a Honda merger is truly dead?

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Japanese automaker Nissan (NSANY) finds itself at a crossroads.

Nissan was poised to participate in a megamerger with rival Honda (HMC), and it was a huge development when the talks were revealed late last year. This was not just some run-of-the-mill consolidation — this would have been like General Motors (GM) and Ford (F) joining forces into one behemoth.

Both brands enjoy their own cultures and reputations, and this may have led to the deal’s unraveling, per some reports. Honda, in the more enviable position, looked at Nissan as a troubled partner that needed more cost cuts, which apparently did not happen at the speed that Honda desired.

Honda then reportedly wanted to make Nissan a subsidiary, which Nissan wasn’t going to allow. Nissan, after all, has a history with such relationships. It felt like a subsidiary with its alliance partner Renault (RNO.PA), and the company still feels disrespected in some fashion to this day.

Both Honda and Nissan say their boards are meeting soon and an announcement will be made shortly.

While Nissan potentially scrambles for a new dance partner, the question remains how Nissan arrived at the position it finds itself in now.

BRUSSELS, BELGIUM - JANUARY 8: Nissan GT-R sports car on display at Brussels Expo on January 8, 2020 in Brussels, Belgium. The GT-R is fitted with a 3.8 L twin-turbocharged VR38DETT V6 engine. (Photo by Sjoerd van der Wal/Getty Images)
Feeling dissed? BA Nissan GT-R sports car on display at Brussels Expo in Brussels, Belgium. (Sjoerd van der Wal/Getty Images) · Sjoerd van der Wal via Getty Images

The company behind enthusiast cars like the mighty GT-R, 240Z sports car, and trusty Pathfinder SUV was once in the driver’s seat in the US and in its home market of Japan.

However, in the late 1990s, the company found itself in dire financial straits and entered into an alliance with French automaker Renault. Renault held the superior position for some time, eventually leading to resentment from Nissan’s Japan-based leadership.

“Nissan’s drive for independence prevented it from fully integrating with Renault [and] from merging with FCA (Fiat Chrysler),” Sam Fiorani, manufacturing expert at AutoForecast Solutions, said to Yahoo Finance. By 2023, Renault eventually sold down its ownership so that Renault held a 15% voting stake in Nissan and Nissan held a 15% voting stake in Renault.

After a renaissance during former CEO Carlos Ghosn’s tenure when the company became profitable, Nissan again struggled with sales due to an aging product lineup and rising costs.

Nissan never really fully recovered. For example, the company reported that global revenues fell 5% in its most recent quarter from July to September and it had a net loss of $62 million versus a profit a year ago. Operating margins dropped below 0.2%.

The company also cut its revenue projection for the 2025 fiscal year by 10%, with the company saying that it is “facing a severe situation” and that it is “taking urgent measures to turn around its performance and create a leaner, more resilient business capable of swiftly adapting to changes in the market.” Nissan said it would cut its global capacity by 20% and reduce its global workforce by 9,000.





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Alexandra Williams
Alexandra Williams
Alexandra Williams is a writer and editor. Angeles. She writes about politics, art, and culture for LinkDaddy News.

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