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Nissan on the verge of bankruptcy in the automotive market? Executives issue warnings, and rumors about a possible acquisition by Honda are gaining strength and may soon materialize.
Nissan is facing one of its biggest financial and operational crises. During a press conference held in November, the automaker stated that it was in “emergency mode”, with one of its executives warning of a crucial countdown: the company would have between 12 and 14 months to turn its situation around and ensure its survival in the competitive automotive market. In this scenario, speculation has arisen about a possible bankruptcy or even an acquisition by rival Honda. In this article, we explore the consequences of this crisis and analyze what is at stake for Nissan.
Has Nissan's bankruptcy happened before in the automotive market?
This emergency Nissan bankruptcy protocol includes laying off 9 people and 20% of its global manufacturing capacity, selling about 10% of its shares in Mitsubishi and delaying the launch of new models. As if that weren't enough, the Renault, which owned 46% of the Japanese brand, is gradually “jumping ship.”
The French company was responsible for saving Nissan from bankruptcy in 1999 and, together with Mitsubishi, formed an alliance. However, Renault is now selling the shares it had and holds less than 36%, with prospects of reducing this number.
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According to the Financial Times, at least two unnamed senior executives at the company have confirmed that the brand is looking for a new anchor investor and that a possible Honda takeover of Nissan is imminent. That will be tough. And ultimately, it will need Japan and the US to generate cash.
Honda's acquisition of Nissan
However, Nissan's bankruptcy in the automotive market may still have a solution and it already has a name and is also Japanese: Honda.
The brand is currently finalizing a deal with the nearly bankrupt Nissan to co-develop electric vehicles. Speculation is that the automaker that makes the Civic and CG could step in and take on the role of anchor investor or even buy the shares sold by Renault.
Three months ago, a joint venture between Honda and Nissan was announced. The partnership was signed with the aim of co-developing electric cars and also stopping the Chinese 'invasion' that is happening in several automotive markets around the world.
However, coincidence or not, the former CEO of Nissan made a bold prediction. According to Carlos Chosn, at the time, it is not possible to imagine for a moment how the partnership between the two will work, unless there is an acquisition of Nissan by Honda in partnership with Mitsubishi with Honda in the driver's seat. He points out that it will be a disguised acquisition of Nissan by Honda.
Impact of Nissan's possible bankruptcy on the Brazilian automotive market
Neither brand has commented directly on Honda's acquisition of Nissan or other negotiations. The brand only says that the partnership with Honda is strategically very important and expects to accelerate the realization of the results of its activities through regular progress at the management level of both companies. Ultimately, it is still too early to say whether this movement will actually happen or not.
What we have, at least in Brazil, is a gigantic investment program to be carried out at the company's factory located in Resende, in the state of Rio de Janeiro, for the production of a new SUV, in addition to renewing the current Nissan Kicks and bringing the new generation.
Nissan's bankruptcy is shocking, given that it is a multinational company created almost a century ago in Japan.
These are rumors that only harm the brand and that journalists love. Instead of waiting for some concrete information, they anticipate it by showing the worst of their imagination. Regrettable.
It's not rumors that's true, they've lost credibility with their actions and bad decisions before they were a brand of prestige and quality now they laugh at their bad cost reduction strategies and wasting the work hand that is doing a lot of bad quality when they should be reviewing an analysis of your strategic strategies and provide tangible countermeasures because you are close a la quiebra
The current market makes it very clear that partnerships, once well structured, yield results, but it is always important to be careful about who you partner with (however, it is necessary to work on this idea well, study all the facts related to it). I really hope it works out, thanks.