Honda to throw lifebuoy as Nissan struggles for survival?

Nissan is navigating turbulent waters as it faces a strong revenue drop and has switched to ‘emergency mode,’ according to its boss, Makoto Uchida.

The Japanese car maker seeks a critical anchor investor to ensure its survival and readies for 2025, a “make-or-break” year. Honda is rumored to step in as a savior and supply the ailing brand with the necessary financial leeway. “The current timeline for product rollout remains in place,” commented Jerome Saigot, CEO of Nissan Benelux.

To recap, Nissan saw profits plummet by 85% and faces a substantial downturn in China, eroding its financial performance. The tide is high for the Japanese car maker as it explores partnerships with stable, long-term shareholders such as banks or insurance groups to alleviate its financial woes.

Activist investment funds Effissimo Capital Management and Oasis Management have stepped in and are mounting pressure to address the crisis.

12 months to recover

There’s room for new stakeholders as the alliance with Renault has been adjusted downwards and concentrates more on specific joint projects like the 2025 Nissan Micra, basically a Japanese spin-off of the Renault R5 E-Tech. “We have 12 to 14 months to survive,” a senior Nissan official reportedly told the Financial Times.

According to the same media outlet, Honda stepping in as a new cornerstone investor seems increasingly likely. With whom it signed a letter of intent to explore an industrial partnership focused on electric mobility, Honda is expected to continue on this path.

When both brands announced their collaboration, Carlos Ghosn, ex-CEO of the Renault-Nissan alliance, called it a “disguised takeover.” Does the former and now-trialed boss’s business instinct point in the right direction?

Targeting 3% market share

“We don’t know more than that the feasibility study is ongoing,” told Melvin Keuter, spokesperson for Nissan Belgium, at a press conference yesterday.

His CEO, Jerome Saigot, highlighted the benefits of Honda. “While the brand might be less focused in Europe, their presence in global markets is of great significance and could benefit Nissan,” he added.

As part of the rescue plan, Nissan announced cutting its workforce by 9,000 and production by 20%. “These lay-offs will be concentrated on assembly and won’t affect the organizational level,” said Saigon, adding that the “current rollout of planned models remains in place. As well as the investments in R&D, which focus on digitization and electrification to meet our goals.”

These targets remain unchanged for the time being. According to Saigot, Nissan aims to have a market share of 3% in Belgium by 2026.

“To make it happen, we will not only focus on increasing volumes but also boost our brand value and address profitability at the dealer level.” Subscription models and revenue from connected services are under investigation.

Discounts to meet emission targets?

The upcoming year is important for Nissan in terms of product launches. In addition to a facelift of its crossover Juke and the new LCV Interstar, the brand aims to make electric cars affordable by launching the new Micra. A replacement for the Leaf is also due, while all-electric versions of both the Juke and Qashqai are in final development.

Whether Nissan will discount its EVs to meet European emission targets for 2025 remains open. “We evaluate pricing at a monthly level,” Saigot said, “We’re flexible on this. If we regard it necessary to compensate for the halted Flemish EV incentive, we will do so.”

Nissan is notably absent from the Brussels Motor Show 2025, following a strategy implemented at the international level. The company’s headquarters view motor shows as an unsuitable marketing channel during this transitional period for the automotive industry and have chosen to withhold investment in such events.