Nissan shares plunge 6% as Mercedes exits $346M stake

Nissan shares plunge 6% as Mercedes exits $346M stake Nissan shares tumbled over 6% on Tuesday after Mercedes-Benz announced plans to sell its entire 3.8% stake worth approximately $346 million in the struggling Japanese automaker. Trading at 341 yen by midday, the shares marked their steepest single-day decline since early July, underscoring mounting investor concerns about Nissan's ability to execute its ambitious turnaround plan. Mercedes Exit Signals Investor Doubt The divestment by Mercedes-Benz's pension trust reflects broader skepticism about Nissan's recovery prospects amid persistent challenges in key markets. According to Bloomberg's reporting, the trust will offload roughly 140 million shares, completely exiting its investment. A Mercedes spokesperson described the stake as lacking strategic importance, calling the sale part of a portfolio cleanup. The timing adds pressure to Nissan's already beleaguered stock, which has declined 24% this year as the company grapples with falling sales in the U.S. and China, along with the impact of tariffs. The pension fund's decision to divest shares that were transferred to its assets in 2016 signals diminished confidence in the automaker's restructuring efforts. Sweeping Restructuring Plan Under Pressure CEO Ivan Espinosa, who took over in April, has unveiled the most aggressive cost-cutting plan in Nissan's recent history. The "Re:Nissan" recovery strategy involves slashing global production capacity from 3.5 million vehicles to 2.5 million and reducing manufacturing sites from 17 to 10 by fiscal year 2027. The plan includes cutting 20,000 jobs, representing 15% of Nissan's global workforce. The automaker reported a staggering $4.5 billion net loss for fiscal year 2024, its second-largest loss in 25 years, while booking another $535 million loss in the first quarter of 2025. Espinosa acknowledged the company faces "a mountain to climb" and emphasized that the drastic measures are "necessary for the survival of Nissan". Nissan has already begun closing facilities, including its historic Oppama plant that has operated since 1961 and its Nissan Shatai facility, while transferring production to its Kyushu factory. The company is also considering selling its Yokohama headquarters for approximately $610 million to KKR as part of its asset optimization strategy. Partnership History Comes Full Circle The stake sale marks the end of a relationship that began when Nissan and then-Daimler AG launched their partnership in 2010. The collaboration initially focused on shared purchasing operations before expanding to joint vehicle platforms and powertrain production. The partnership produced joint facilities like the Aguascalientes plant in Mexico and shared engine production in Tennessee. However, the alliance has been unwinding in recent years. In early 2021, Nissan sold its 1.5% stake in Mercedes-Benz to help overcome financial difficulties. Industry observers noted that the once-promising partnership, which had aimed to deliver billions in savings, has effectively unraveled as both companies refocused on their core strategies. The Mercedes pension trust indicated that ongoing collaboration between the companies would not be affected by the stake sale, though the practical impact remains unclear given the reduced financial ties.

Nissan shares plunge 6% as Mercedes exits $346M stake

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Nissan shares plunge 6% as Mercedes exits $346M stake

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