Foreword

Nissan, once hailed as a trailblazer in innovation and efficiency, finds itself in a period of profound transformation. After years of governance scandals, stagnant product pipelines, and eroding profitability, the Japanese automaker is embarking on one of the most significant overhauls in its modern history. This comes at a time of global disruption across the automotive industry; from the rise of electric vehicles and geopolitical trade tensions to shifting consumer expectations and digitalisation. In 2025, Nissan’s leadership unveiled a sweeping restructuring and recovery roadmap that seeks to reposition the company for long-term survival and renewed competitiveness. This report explores four critical dimensions of Nissan’s current strategy: its global restructuring efforts, domestic retrenchment in Japan, electric vehicle (EV) transformation, and the impact of international tariffs, all framed within the context of a recalibrated alliance strategy following the fallout of the Carlos Ghosn era.

Global Restructuring - The Re: Nissan Plan

In May 2025, Nissan unveiled its “Re:Nissan” plan, a comprehensive restructuring strategy aimed at restoring profitability by fiscal year 2026. The plan includes:

• Workforce Reduction: Cutting approximately 20,000 jobs, representing about 15% of its global workforce.

• Plant Closures: Reducing the number of manufacturing plants from 17 to 10 by 2027, affecting facilities in Japan, Mexico, India, South Africa, and Argentina.

• Asset Optimization: Considering the sale and leaseback of its Yokohama headquarters, valued at over ¥100 billion (approximately $700 million), to raise funds for restructuring efforts.

These measures respond to mounting financial losses, with Nissan reporting a net loss of ¥671 billion ($4.5 billion) for fiscal year 2024, its worst annual result since 1999. The company also projects a significant annual loss of up to ¥750 billion ($5.3 billion) due to higher-than-anticipated restructuring and asset impairment costs.

CEO Ivan Espinosa acknowledged that the company’s financial and operational issues originated about a decade ago due to unrealistic management goals set in 2015. At that time, Nissan aimed to sell 8 million vehicles annually, leading to significant investments in production capacity and workforce expansion. However, current sales are significantly lower, with only 3.3 million vehicles sold in fiscal year 2024, highlighting the gap between expectations and reality.

Japan Restructuring: Retrenchment or Renewal?

Nissan’s global restructuring plan includes deep cuts to its domestic operations. In April 2025, the company announced it would shut down one of its two vehicle assembly lines at the Kyushu plant, reducing output capacity by nearly 40% at that facility. This follows earlier downsizing at Tochigi and Oppama plants. These moves represent a significant retreat from Nissan’s once-dominant manufacturing position in Japan.

The company attributes this to structural challenges in its home market. Japan’s aging population and shrinking workforce have led to a steady decline in domestic car sales. Unlike Toyota, which has successfully diversified its revenue away from Japan, Nissan remains more exposed to these demographic headwinds. In this context, plant closures reflect not just cost-cutting, but also a reevaluation of where production capacity is most needed.

Still, Nissan is attempting to retain its technological edge domestically. Some Japanese plants are being retrofitted for EV production, and the company is investing in battery recycling and reuse initiatives in Yokohama and Iwaki. These moves align with broader Japanese industrial policy supporting green tech and could enable Nissan to reposition its home base as an innovation hub.

However, the optics of plant closures and job cuts in Japan are politically sensitive. Nissan’s ability to manage labor relations and community impacts will be critical to maintaining its social license to operate. If the domestic transition fails to yield clear innovation gains, Nissan risks undermining its brand within Japan; a country where corporate reputation remains closely tied to employment stability.

Electrification and the Product Revamp

Nissan was a pioneer in the electric vehicle space with the launch of the Leaf in 2010. For a time, it was the world’s best-selling EV. Yet over the past decade, Nissan lost ground to competitors like Tesla, BYD, and Hyundai, all of which accelerated their EV programs with newer designs, better range, and superior software integration.

In response, Nissan launched the “Arc” plan in 2024, a mid-term strategy to introduce 30 new models globally by 2027, with over half of them being electrified. The strategy focuses on modular design, shared EV platforms, and regional differentiation. Nissan aims to streamline its lineup, reduce platform complexity, and increase parts commonality to drive cost efficiency.

Part of this plan includes scaling up investment in solid-state batteries. Nissan expects to commercialise this next-generation battery technology by fiscal 2029. If successful, solid-state batteries could provide a key edge in energy density, charging time, and cost. However, the timeline remains ambitious, and competitors like Toyota are also aggressively pursuing the same goal.

Meanwhile, Nissan’s Ariya crossover SUV, launched in 2022, represents its first serious attempt to reenter the competitive EV space. While reviews of the Ariya are mixed, especially on pricing and range, the model shows that Nissan is at least back in the game. The company is also expanding its U.S. EV production at the Smyrna plant, indicating a long-term commitment to the North American market.

In sum, Nissan is moving in the right direction, but it is playing catch-up. Its success in electrification will depend not just on launching EVs, but on ensuring they meet consumer expectations in performance, price, and digital experience.

Tariffs and Trade Tensions: Navigating a Volatile Landscape

A new round of U.S. tariffs in April 2025 (25% on imported vehicles) has sent shockwaves through the global automotive sector. For Nissan, these tariffs pose a direct threat to profitability in one of its most important markets. The company quickly announced it would shift production of the Rogue SUV, one of its top sellers, from Japan to the U.S. to avoid the tariffs. Similarly, it paused shipments of some Mexican-built models like the Infiniti QX50 and QX55.

Nissan’s Americas chairman, Christian Meunier, warned that the tariffs could make cars unaffordable for working-class families. Low-cost models like the Nissan Versa, priced under $30,000 and built in Mexico, are particularly at risk. Nissan faces a strategic dilemma: either raise prices and lose competitiveness or absorb costs and hit margins.

The company estimates up to ¥450 billion ($3 billion) in additional expenses from the tariffs, affecting nearly half its U.S. sales. In response, Nissan is lobbying for exemptions and exploring production shifts to mitigate impact. Still, its exposure to North American trade policy makes it more vulnerable than peers with more localized supply chains.

Longer term, Nissan may accelerate its “local-for-local” manufacturing strategy, which involves producing vehicles in the region where they’re sold. While this can protect against trade disruptions, it requires capital investment and tight operational execution, areas where Nissan has struggled in the past.

Alliance Dynamics: Renault, Mitsubishi, and the Search for Balance

Nissan’s alliance with Renault and Mitsubishi has long been a key feature of its strategy. The tripartite relationship was originally created to share platforms, costs, and research and development, but it has not been without friction. In 2023, Nissan and Renault rebalanced their capital relationship, reducing Renault’s stake and granting Nissan greater operational independence. This marked a turning point, symbolising a move from integration to strategic coordination.

The Alliance continues to jointly develop electric platforms and coordinate regional production strategies, particularly in Europe and Southeast Asia. However, the sense of a unified mega-group has diminished. Nissan is increasingly focused on reclaiming its own identity and agility.

This rebalancing cannot be separated from the legacy of Carlos Ghosn, the former CEO who architected the alliance but later became its most controversial figure. Ghosn was arrested in Japan in 2018 for financial misconduct and famously escaped the country in 2019. His fall from grace and the subsequent governance crisis revealed deeper structural tensions between Nissan and Renault. The company has since implemented reforms to improve oversight and avoid the overcentralisation that characterised the Ghosn era.

Today, the alliance remains relevant but less binding. Nissan is hedging its bets; retaining access to shared platforms while pursuing internal restructuring and innovation independently. This more flexible, less hierarchical approach may offer the best balance of scale and agility in a rapidly shifting industry.

Conclusion

Nissan stands at a crossroads. After years of governance turmoil, declining sales, and strategic drift, the company is now executing a multifaceted turnaround plan. The Re:Nissan strategy is ambitious, shrinking its global footprint, repositioning its domestic operations, reinvesting in EV innovation, and recalibrating its alliance with Renault and Mitsubishi.

The challenges are considerable: navigating volatile trade conditions, managing social and political backlash to domestic downsizing, and catching up to EV leaders with more advanced technology and brand strength. Yet there is a sense that Nissan is finally facing its problems head-on, with a willingness to make difficult decisions and focus on long-term sustainability.

Whether Nissan can fully reclaim its former stature remains uncertain. But if it can execute on its current plans it may yet carve out a distinct and resilient path forward in the automotive industry’s electric and connected future.