Nissan is preparing to announce its biggest losses for the past financial year. Net losses are estimated at approximately $5 billion, compared to the previously expected $561 million. Nissan has abandoned merger talks with Honda and is reorganizing its business. How do your finances look? Living in overdraft?
Credit card debt? It could be worse, like at Nissan, which is about to announce dramatic financial results with record net losses of approximately $5 billion for the financial year ended in March. Nissan’s official earnings report will only be shown on May 13, but it already acknowledges that the reports are expected to indicate net losses of 700-750 billion yen ($4.91-5.26 billion) for the year to March, although they had previously forecast more modest losses that wouldn’t be too impressive – 80 billion yen ($560 million). This will be the largest loss in the company’s history. The automaker explains the attempt to land in the big red numbers with costs for writing down the value of assets on the company’s balance sheet.
They recorded expenses of 500 billion yen ($3.5 billion) for North America, Latin America, Europe, and Japan, and state that an additional sixty billion yen ($420 million) will need to be added as a result of further restructuring costs. Nissan is undergoing major reorganization changes in an attempt to save itself after the $60 billion merger talks with Honda failed. Although the talks were initially successful, they stalled in February, with sources close to the manufacturers further revealing that Nissan sat down at the table thinking it would be an equal partner, but pulled out when it realized that Honda wanted to make Nissan its subsidiary. Nissan has already announced the cutting of 9,000 jobs, plant closures, and optimization of the model range aimed at saving over $2.5 billion, and is actively seeking a new partner, acknowledging that. Taiwanese tech giant Foxconn has expressed a desire to collaborate with Nissan, but noted that it prefers to collaborate with the Japanese company rather than acquire it.
Although the merger talks with Honda have fallen apart, the three companies indicate that they will continue to collaborate in terms of electrification and software development as part of a broader effort to remain competitive in the race to develop electric vehicles, especially against Chinese competitors.