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Renault Reduces Stakes At Nissan As The Japanese Automaker Seeks New Shareholder
Nissan is urgently seeking a new shareholder as long-term partner Renault begins to reduce its stake in the ailing Japanese carmaker. “We have 12 to 14 months to survive,” a senior Nissan insider told the Financial Times.
The alliance with Renault dates back to 1999 when the French carmaker saved Nissan from imminent bankruptcy. For a long time, Renault held around 43 percent of the Japanese company’s shares. That has now been reduced to just under 36 percent. Renault announced last year that it would eventually reduce that stake to 15 percent.
According to sources in the British business newspaper, Nissan wants a stable long-term shareholder such as a bank or insurer to take over part of Renault’s current shareholding. However, Nissan is struggling with falling car sales in important markets like China and the United States. In addition, profits have plummeted due to rising costs. Something that does not help is that Donald Trump will soon be president of the United States again since he has announced higher import duties.
Earlier this month, Nissan announced that it would cut 9,000 jobs worldwide, or about 7 percent of its workforce. The company hopes to save money with this. According to the latest reports, the company also wants to reduce its production in the US. Nissan is also working on a more intensive collaboration with Honda in the field of electric vehicles and software technology.
“This is going to be tough,” said the high-ranking source quoted by the Financial Times. Ultimately, he said, Nissan needs to increase its sales in the United States and China because there is a lot of money to be made there. The company would also not rule out Honda buying some of Nissan’s shares. “All options” would be considered. Nissan itself did not want to comment to the business newspaper.
The alliance with Renault has come under severe pressure in recent years following the downfall of former leader Carlos Ghosn. Ghosn was CEO of both Renault and Nissan and chairman of the alliance of the groups. In 2018, he was ousted as CEO and arrested in Japan for alleged financial misconduct at Nissan. In late 2019, he made a spectacular escape from Japan, fleeing via Turkey to Lebanon.
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