Renault Suffers $11 Billion Loss Due to Nissan’s ‘Catastrophic’ Collapse.
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It’s widely recognized that Nissan has been experiencing a significant decline in sales over the past few years. After months of despair and speculation, the financial figures have finally revealed just how severe the situation is: 11 billion. Specifically, that’s 11 billion dollars that alliance partner Renault plans to write off in the first half of 2025 as Nissan hovers on the brink of collapse.
For Renault, if there is any “good” news—and that term is used loosely—it’s that this $11 billion largely existed only on paper. It reflects funds that have already been invested in Nissan’s operations, signifying Renault's acknowledgment that it essentially wasted that money. Moving forward, Renault will assess its Nissan stake based solely on the market value of the Japanese automaker’s shares, as reported by Reuters.
In light of this news, Renault’s stock experienced a slight uptick, while Nissan’s shares fell. Currently, Renault holds a 37.5% stake in its Japanese partner.
The situation in the U.S., Nissan’s largest single market, is particularly dire. Vinay Shahani, who oversees U.S. sales for Nissan, informed dealer representatives that early second-quarter sales data indicated an “absolute catastrophe.”
As per the results released on Tuesday, the company’s sales for the second quarter have decreased by 6.5% compared to the previous year. The main Nissan division saw a reduction of 6.1%, while sales for the luxury brand Infiniti dropped by 12.7%. Although the Nissan brand's full-year results are nearly flat compared to 2024, largely due to stronger pre-tariff sales in the first quarter, that demand has since dwindled. Infiniti's full-year sales are still down by 9%.
Nissan’s new CEO, Ivan Espinosa, has expressed his readiness to take whatever measures are necessary to improve the company’s performance, including the launch of a new strategy called “Re:Nissan,” which will cut the workforce by another 11,000 employees and reduce its 17 production facilities to 10 by the end of 2027.
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Renault Suffers $11 Billion Loss Due to Nissan’s ‘Catastrophic’ Collapse.
Nissan's persistent financial problems have impacted its French alliance partner, Renault.