Nissan is facing the very real danger of going bankrupt within the next year amid a crisis across its business.
The Japanese brand is in the middle of a cost-cutting spree, slashing 9000 jobs around the world, cutting its production capacity by as much as 25 per cent and is planning a complete product overhaul in a bid to turn its fortunes around. The company’s chief financial officer, Stephen Ma, has announced he will step down, and all of this comes less than 18 months after its former chief operating officer, Ashwani Gupta, left the company.
It leaves CEO Makoto Uchida with the responsibility of saving the famous brand, as Nissan looks for a saviour in the wake of Renault’s decision to scale back its investment in the company. In a bid to raise capital and cut its liabilities, Nissan announced it has reduced its stake in Mitsubishi. Previously the Renault-Nissan-Mitsubishi Alliance was considered a strong trio that could leverage each other’s resources but that appears to be fractured beyond repair now.
Instead, Honda has emerged as a potential saviour, with the two Japanese companies reportedly in talks for a potential Nissan-Honda merger. The two were already working together on electric vehicles and software, so there is scope to expand those discussions to enhance both their long-term outlooks.
The reality is Nissan is merely the company most publicly showing the struggles for the ‘legacy’ car makers amid the rise of the Chinese car industry. Nissan has been caught out, too slow to react to the new competition and having invested in the wrong products.
While on the surface its Australian sales still appear relatively strong, the brand is comfortably amongst the top 10 sellers, Nissan has declined dramatically in the last decade. Back in 2013 Nissan sold nearly 77,000 new vehicles in Australia but is on course to sell around 45,000 in 2024; which is actually a steep improvement on just over 39,000 in 2023.
While most major brands have lost share in the past decade thanks to an increasingly competitive and diverse local market, Nissan has seemingly struggled more than most to keep up with changing consumer tastes.
Once a leader in electric vehicles, Nissan Australia is still trying to push the out-dated Leaf because it has been overlooked for the newer Ariya SUV. The Tesla Model Y rival is reportedly due in the second half of 2025, which will be five years after it first went on sale in the rest of the world.
The Navara ute is still a steady performer for the brand but can’t compete in sales volume against the newer Ford Ranger, Mitsubishi Triton and Mazda BT-50 and is under increasing threat from newcomers like the GWM Ute and LDV T60.
Nissan Australia may still be performing adequately, but unless global management can find a cash-rich partner to help usher it through these uncertain times, the brand faces a real struggle to survive.
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