NISSAN MOTOR CO., LTD.

Business Details

Core segment engaged in the manufacture and sale of automobiles and parts. Handles Passenger Vehicles & Commercial Vehicles, Parts for Overseas Production, etc., and operates through a global network spanning Japan, North America, Europe, Asia, and other regions. Global retail unit sales in FY2025 (ending March 2025) totaled 3,151 thousand units (down 5.8% year on year). Works in conjunction with the Sales Financing Business to provide comprehensive mobility value to customers. Operating losses in the Automotive Business have continued, and cost reductions are being pursued under the "Re:Nissan" turnaround plan.

Recent Overview

Unit sales declined across all regions, widening the operating loss. Impairment losses narrowed from the prior period but remained at a high level.

In FY2025 (ended March 2025), the Automotive Business segment operating loss worsened to ¥292,890 million (prior period: △¥267,979 million). Sales decreased to ¥10,920,106 million (prior period: ¥11,645,478 million). Impairment losses narrowed to ¥366,247 million (prior period: ¥494,935 million), but included impairments on business-use assets in North America (¥154,840 million), Europe (¥47,088 million), Japan (¥22,369 million), and others, in addition to an impairment loss of ¥15,825 million on leased vehicles associated with the elimination of the U.S. EV tax credit. Automotive Business free cash flow turned positive in the second half, reaching ¥112,000 million. Manufacturing cost reductions are being pursued under the "Re:Nissan" turnaround plan.

Key Products

Growth Drivers

• Manufacturing cost reductions under the "Re:Nissan" turnaround plan (expected to contribute a ¥340.0 billion improvement to profit in FY2026, ending March 2026)
• Improved sales performance with global retail unit sales projected to increase 4.7% to 3.30 million units in FY2026 (ending March 2026) (contributing ¥155.0 billion to profit)
• Partial mitigation of tariff impact contributing ¥30.0 billion to profit (FY2026 forecast, ending March 2026)
• Reduced depreciation expense from change in useful life of internally used software (from 5 years to 8 years), improving operating income by ¥11,068 million
• Improved operating income from a change in estimate for product warranty provisions (¥36,603 million)
• Improved investing cash flow from increased proceeds from sales of fixed assets (¥189,731 million)

Risks

• Pressure on profits from U.S. tariffs (including a 25% tariff on vehicles imported from Mexico), expected to reduce profit by ¥20.0 billion in FY2026 (ending March 2026)
• Risk of a ¥85.0 billion reduction in profit from raw material price fluctuations (FY2026 forecast, ending March 2026)
• Declining unit sales in China amid accelerating shift to new energy vehicles and intensifying price competition (653 thousand units in FY2025, ending March 2025, down 6.3% year on year)
• Sluggish unit sales in Europe and Japan (down 9.7% year on year in Europe, down 13.5% year on year in Japan)
• Risk of impairment on leased vehicles from declining used vehicle market prices following elimination of the U.S. federal EV tax credit
• Risk of additional costs arising from large-scale restructuring (special early retirement incentive payments of ¥85,048 million recorded)
• Risk of a ¥60.0 billion reduction in profit from inflationary impact (FY2026 forecast, ending March 2026)
• Risk of a ¥148.0 billion reduction in profit from one-time factors (FY2026 forecast, ending March 2026)
• Ongoing domestic and international litigation related to past false statements in securities reports
• Risk of rising funding costs due to credit rating downgrades (outstanding corporate bonds increased from ¥1,708,532 million to ¥2,671,312 million)