Nissan warns of £4bn loss as costs rise and Trump tariffs loom
Nissan says it expects to lose as much as £4bn this year because a turnaround plan will be more costly than expected.The predicted loss at Japan’s third-largest carmaker is almost 10 times the figure it had previously guided.Nissan has been struggling for several years with leadership turmoil and falling profits.Its latest efforts to turn around the business include making deep cost cuts, but the car industry is facing deep uncertainty over the direct and indirect effects of Donald Trump’s tariffs.Nissan said it expected lower sales this year of 3.
35m, down from 5m in 2019, blaming “changes in the competitive environment and deterioration in sales performance”.The company did not explicitly blame tariffs.The profit warning is the first significant move by Ivan Espinosa, the Mexican who was named last month as chief executive after two decades at the company.His appointment was announced after Makoto Uchida was forced out when an attempt to merge with Japanese rival Honda fell through in February.Espinosa said: “We are taking the prudent step to revise our full-year outlook, reflecting a thorough review of our performance and the carrying value of production assets.
We now anticipate a significant net loss for the year, due primarily to a major asset impairment and restructuring costs as we continue to stabilise the company.Despite these challenges, we have significant financial resources, a strong product pipeline and the determination to turn around Nissan in the coming period.”Nissan is pushing forward with plans to cut 9,000 jobs, even as it tries to launch electric models in a switch away from combustion engines.The company said most of the losses stemmed from a £2.6bn impairment in the value of assets around the world.
However, it insisted it “remains in a solid cash position” despite concerns over its debt.Moody’s, a rating agency, downgraded Nissan’s debt to junk status in February, indicating that its analysts had doubts about the carmaker’s ability to repay.The efforts to turn Nissan around will not be aided by Trump’s tariffs of 25% on all car imports.Tatsuo Yoshida, a Bloomberg Intelligence analyst, told the AFP news agency that US tariffs would hit Nissan the hardest of the major Japanese carmakers.“If this situation goes on for ever, it can be a death blow for Nissan, in a sense that it will run out of cash and default,” Yoshida said before the profit warning.
Nissan makes cars in Smyrna, Tennessee, giving it some protection from the tariffs.It produced 524,000 vehicles in the US out of the 924,000 it sold in the country in 2024.Reuters reported that Nissan had cut production of its top-selling US model, the Rogue SUV made in Japan, because of the impact of tariffs.Sign up to Business TodayGet set for the working day – we'll point you to all the business news and analysis you need every morningafter newsletter promotionEspinosa’s efforts to turn the company around will be closely watched by rivals after years of turmoil kicked off by the arrest and sensational flight to Lebanon of its former chief executive Carlos Ghosn.The company was riven by infighting after Ghosn’s arrest, while sales and profits faltered.
If it fails to stop the losses, Nissan could become more vulnerable to a takeover, with a hostile bid from Honda a possible option.Taiwan’s Foxconn has expressed interest in buying shares.Best known for making iPhones for Apple in China, it is considering an entrance into the automotive industry.Nissan’s global struggles have cast a shadow over its factory in Sunderland.That facility, the company’s only assembly plant in Europe, has also struggled.
It lost £63m in the year to March 2024, according to accounts published this month, compared with a £32m profit the year before,
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The US and China held talks on Thursday to help resolve the trade war between the world’s two largest economies, Donald Trump said.“We may reveal it later, but they had meetings this morning, and we’ve been meeting with China,” the US president told reporters at the White House.China had earlier hit back against Trump’s previous claim to be close to a trade deal with Beijing.Trump had buoyed markets by suggesting on Wednesday that the US was “actively” negotiating with Beijing, and pointing to hopes of a deal that would “substantially” reduce tariffs, now set at 145%, on goods coming into the US from China.The Chinese commerce ministry’s spokesperson He Yadong said there were “currently no economic and trade negotiations between China and the United States”
Nissan warns of £4bn loss as costs rise and Trump tariffs loom
Nissan says it expects to lose as much as £4bn this year because a turnaround plan will be more costly than expected.The predicted loss at Japan’s third-largest carmaker is almost 10 times the figure it had previously guided.Nissan has been struggling for several years with leadership turmoil and falling profits. Its latest efforts to turn around the business include making deep cost cuts, but the car industry is facing deep uncertainty over the direct and indirect effects of Donald Trump’s tariffs.Nissan said it expected lower sales this year of 3
IMF urges global leaders to resolve trade tensions rapidly, as China tells US to ‘cancel all unilateral tariffs’ – as it happened
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