• Seeks partners for faster economies of scale
• Eyes further “win-wins” with Renault
• Tests software-defined vehicles with Honda

Ten months after Nissan Motor broke off a merger talks with Honda Motor, the Japanese auto giant is weighing several other partnerships as part of a major business overhaul in a world beset by tariff uncertainty and on the cusp of a technological revolution.

“2024 was a year of deterioration,” said CFO Jérémie Papin speaking exclusively to Mergermarket. “We’ve undergone a significant change of management. The new team is younger and aligned on what needs to be done,” said Papin who was appointed to the role in January 2025.

And there is plenty that does need to be done.

The company’s share price has been declining for years but there are now attempts underway to reverse the momentum. The company unveiled its Re:Nissan recovery plan in May detailing major cost cutting and a path back to operating profitability and how it will create a more efficient business in a fast-changing world.

The size of that task was laid bare in its 1H25 results last month when the Japanese carmaker forecast a JPY 275bn operating loss for the year, largely due to tariffs; North America is its largest market (37%) for vehicle sales.

Nissan said cost cuts announced as part of the recovery plan “are advancing rapidly” as it seeks positive automotive operating profit and free cash flow by fiscal year 2026.

“With the tariffs, there is an additional hurdle that has to be addressed with operational or cost-cutting,” he said, adding that the Nexperia chip crisis has encouraged the Japanese automaker to be even more prudent.

Papin explained the automaker initially expected its gross tariff exposure would be JPY 450bn. After the tariff level on Japanese auto imports into the US dropped from 27.5% to 15% in September, full year exposure is now estimated to be around JPY 250bn.

“One big unknown is what the tariffs in the end will be for the US and Mexico, and how the retaliation tariffs, between Canada and the US will evolve,” Papin said, noting the upcoming USMCA (United States-Mexico-Canada Agreement) negotiation, expected in 2026.

“Tariff rules may still change,” he noted.

To offset the risks, Nissan is reviewing its industrial strategy with a focus on localising parts and adjusting production flows between China, Mexico, Japan, and the US — for example, increasing Rogue SUV output in the US and finding new markets for Japanese-built vehicles.

“Ultimately, what we cannot eliminate as a flow, it will have to be dealt with through cost-cutting, somewhere in the business. Through fixed costs mostly,” Papin said.

Nissan has announced a sale and leaseback of its Yokohama headquarters, in addition to plans to cut some 20,000 employees and close seven plants. So far, it has achieved JPY 80bn in fixed cost savings and aims to surpass JPY 250bn by FY26.

It has also eliminated two vehicle lines from production in Mexico that were for sale in the US, given that the cost of 25% tariffs would exceed the returns on the vehicle.

“If there was a change in the level [of tariffs] with Mexico to below 25%, some of that volume would come back,” Papin said.

Papin said Nissan is prioritizing suppliers that can localize production to reduce tariff exposure, while streamlining R&D and decision-making to accelerate time-to-market and establish standards that improve cost efficiency and competitiveness.

Partnerships and alliances

Reinforcing partnerships is one of the key pillars of the Re:Nissan plan.

Following the collapse of merger talks with Honda in February, and the recent appointment of Francois Provost as CEO of Renault, speculation is growing that Nissan and the French group are in renewed talks on their long-standing alliance.

Papin, who has served in executive roles at Nissan and its alliance partner Renault for over a decade, said the company is open to partnership projects with its French counterpart, noting the two groups already have strong ties in Europe and India. “The idea is always to look for further win-wins for the companies,” Papin said.

A company spokesperson added that the alliance remains a cornerstone of Nissan’s strategy, supporting key projects such as Renault assembling vehicles, like its Magnite brand, in India and manufacturing the Micra EV in Europe. Earlier in the year, media reports had also flagged the possibility of Nissan reducing its stake in Renault as a liquidity lever; the spokesperson said only that the 15% cross-shareholder can be reduced to 10% for both parties.

Regarding Honda, “we are exploring options in software-defined vehicles, joint projects,” he said. “We haven’t said anything on trucks.”

Papin explained that as the company is seeking to shift its strategic priorities in the face of headwinds from shifting consumer preferences, the path to electrification and pressure from China, the company is looking beyond traditional auto manufacturers for partnerships.

“So much is needed in the auto industry to be competitive today, in terms of diversification of power trains, incremental expectations from consumer from connected services, safety gains linked to autonomous driving capabilities,” Papin said.

“If you want to be relevant, you will need to cooperate with someone. If you want economies of scale faster or share entry tickets faster. You have to partner. So, Nissan is looking at that,” Papin said.

He added that it is also seeking partners within its R&D and supply base, aiming to create economies of scale at the supplier that will benefit both entities. “That is independent of will I do more with Renault, Mitsubishi, Honda and so on,” he added.

Robots on wheels

As the auto industry shifts from traditional combustion engines towards what Elon Musk coined as “robots on wheels”, technology partnerships are central to Nissan’s next-generation mobility strategy.

It is currently trialling its advanced driver assistance ProPilot technology in Yokohama, Japan – viewing it as a more cost-effective technology than fully automated models – ahead of launch in 2027.

In April, Nissan announced a partnership with UK-based autonomous driving software developer Wayve, using its AI driver software. While in China, it has partnered with Huawei to develop intelligent digital software for a “smart cockpit” for the Dongfeng-Nissan, a joint venture between the Japanese automaker and Chinese EV manufacturer Dongfeng Motor.

Papin says Nissan is aiming to position itself as a strong automotive partner to Wayve. The technology will be fully integrated into models and fully branded Nissan, he said.

“If successful, the logic would be if it is good …. we need to make it big,” Papin said, noting that its partnership with the British group would not limit its geographical expansion. Asked if Nissan could consider a capital alliance with Wayve, the spokesperson said that there are no other projects to share at this time.

However, he said that an increased effort on R&D in this area would require a shift in resource focus from other areas, and that could open opportunities for other potential partners.

Papin said after raising JPY 860bn in bonds this year, including a JPY 200bn 2031 convertible bond, Nissan has covered its coming maturities and has strong free cash flow to September 2027.