Nissan posts $535 million loss amid overhaul
Nissan reported a quarterly loss of $535 million, primarily due to U.S. tariffs, restructuring efforts, and declining sales volumes. The automaker, Japan's third-largest, is undergoing a significant turnaround plan that includes closing seven plants globally and laying off approximately 15% of its workforce, equating to around 20,000 jobs.
For the April to June period, Nissan's operating loss was 79.1 billion yen, which was better than analysts' expectations of a 123.9 billion yen loss and also less than the company's own forecast of a 200 billion yen shortfall announced earlier. This marks Nissan's first quarterly operating loss in over four years.
As part of its restructuring, Nissan plans to cease production at its Civac plant in Mexico by March 2026, consolidating operations at the Aguascalientes facility. The company aims to reduce its global production capacity from 3.5 million vehicles to 2.5 million and cut the number of manufacturing sites from 17 to 10.
The financial strain is exacerbated by a 25% tariff on foreign-made vehicles and auto parts imposed in April 2025, which Nissan estimates will lead to around ¥450 billion in increased costs, significantly impacting nearly 45% of its U.S. sales. Despite efforts to mitigate these tariffs by shifting production to U.S. facilities and prioritizing U.S.-assembled vehicle sales, only about 30% of the tariff impact has been offset so far.
Nissan faces challenges from slumping global sales, increased competition from electric vehicle startups, and a failed merger attempt with Honda. The company's stock has significantly declined in 2025, and its profit margins in key markets like North America have turned negative. Analysts express caution regarding Nissan's recovery prospects without compelling new products and a stronger brand identity.
