The Japanese carmaker Nissan is apparently seeking a new strategic bailout after the collapse of merger talks with Honda. According to a report by the Financial Times, the heavily indebted company is seeking the entry of Tesla as a financially strong investor. A group of Nissan managers has developed a concept proposing that the U.S. electric car manufacturer acquire shares in Nissan, possibly together with the Taiwanese chip manufacturer Foxconn. In addition to former Tesla manager Hiro Mizuno, Japan’s former Prime Minister Yoshihide Suga is also reported to support the initiative. The key attraction for Tesla is likely to be Nissan’s U.S. plants. These factories could help Elon Musk expand his domestic production, especially given the higher tariffs U.S. President Donald Trump is considering on foreign car imports. Acquiring significant shares in Nissan would provide the struggling Japanese company with much-needed capital and offer Tesla more production infrastructure for the North American market. At the end of 2024, Nissan was exploring a closer alliance with Honda to compete in the critical Chinese market and the electric vehicle segment. After both companies ended talks last week, Foxconn showed interest in acquiring the 35 percent of Nissan held by Renault. However, according to FT, Nissan managers are more inclined towards Tesla as the main financier of an investor consortium. Renault had already partially dissolved the alliance started in 1999 and successively sold off its own Nissan shares. In Tokyo, Nissan's share price temporarily surged by 10 percent on Friday following the announcements. The market capitalization now amounts to almost 11 billion euros, while Tesla weighs in at 1.1 trillion euros on the stock exchange. Nissan itself is struggling: in the last quarter, the carmaker recorded a loss of 14 billion yen (87 million euros), and production fell by 14.7 percent. Moody's recently significantly downgraded Nissan’s credit rating. Whether Tesla actually comes on board and how this would align with Foxconn's expressed interest remains uncertain. What is certain is that Nissan urgently needs a strategic solution to keep up in the highly competitive automotive industry.
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Nissan considers Tesla entry after failed Honda merger: Interest in US factories and electric car know-how
2/24/2025, 1:32 PM
Nissan is relying on Tesla as a potential major investor after the failed Honda merger to address debt issues and competitive pressure.
Eulerpool News Feb 24, 2025, 1:32 PM