The Fall of Nissan: How Pride, Missed Hybrids, and a Broken Honda Deal Shattered a Japanese Giant

How Nissan Lost Everything: From Global Powerhouse to the Brink of Bankruptcy

February 6, 2025.

In a quiet Tokyo boardroom, Makoto Uchida, CEO of Nissan, steps in to meet Toshihiro Mibe, President of Honda Motor Company. The air is thick with anticipation.

Both men are here to discuss what could become one of Japan’s most historic mergers — a deal to unite Honda and Nissan into a powerful auto giant. For Nissan, this could mean survival. The company is drowning, desperate for rescue.

But Uchida hasn’t come to surrender.
Sitting across from Mibe, he calmly delivers his decision: Nissan is walking away.

The merger is off.

A month later, Uchida resigns. His choice may have sealed Nissan’s fate.
How did it come to this? How did one of Japan’s proudest automakers end up at the edge of ruin — and turn down the lifeline that could’ve saved it?

To understand, we have to rewind the clock — back to the late 1990s.

The First Fall — and the Man Who Saved Nissan

By the late ’90s, Nissan was in deep trouble.
The company was buried under $32 billion of debt. Sales were erratic, market share had collapsed, and the 1997 Asian Financial Crisis had crippled demand. Even Toyota was struggling.

Then came a saviour from France.

Renault stepped in, buying a 36.8% stake in Nissan.
With that deal was born the Renault–Nissan Alliance, and a new leader entered the scene — Carlos Ghosn.

Ghosn made a bold promise: to pull Nissan back into profit within a year.
He launched a brutal turnaround — closing five plants, firing 21,000 employees, cutting consultants, and slashing costs everywhere possible.

And it worked.

Within a year, Nissan went from a $6.46 billion loss to a $2.7 billion profit — its best result ever. Ghosn had done the impossible.

But history would soon turn on him. The man who saved Nissan would later bring it to its knees.

The Alliance Expands — and the Empire Cracks

By 2005, Ghosn had become CEO of both Renault and Nissan — the first person in history to lead two companies on the Fortune Global 500 list.

In 2016, Nissan acquired a 34% stake in Mitsubishi Motors, forming the Renault–Nissan–Mitsubishi Alliance. The trio aimed to rival automotive giants like Volkswagen and Toyota.

For a while, it worked. Nissan was a global powerhouse.

Then came 2018 — and Ghosn’s downfall.

He was arrested for under-reporting income and using company funds for personal gain. Within weeks, he was removed as chairman. Then, in one of the most dramatic escapes in corporate history, Ghosn fled Japan in a box — to Lebanon.

The empire collapsed overnight. Stocks plummeted, trust evaporated, and the Alliance fractured.

Nissan’s next CEO, Hiroto Saikawa, was soon caught in his own pay scandal and resigned. The company was leaderless, shaken, and directionless.

Uchida Takes the Wheel

In October 2019, the board turned to Makoto Uchida.
But he inherited chaos. Nissan’s stock had already halved since Ghosn’s arrest.

Then came the pandemic.

By early 2020, revenue had dropped 50%, with losses of $2.67 billion. Nissan was bleeding again.

Uchida introduced a bold plan called “Nissan NEXT.”
He promised a leaner, more focused company — one that would return to growth by 2023 with a 5% operating margin and a 6% global market share.

To achieve it, he cut 20% of production, dropped 15% of car models, and rolled out 12 new electric vehicles, reallocating $3 billion in costs.

It worked — briefly.
By 2021, Nissan was back in profit with $2.2 billion. In 2023, profits rose again, hitting a 5.2% margin — goal achieved.

But success was fleeting.

The Hidden Problem — and the Wrong Bet

In 2024, cracks appeared again. Nissan was sitting on 640,000 unsold vehicles, twice the usual inventory.

Their key models — the Rogue and Sentra — were overproduced, and sales slowed. Discounts and cash incentives flooded dealerships, but nothing fixed the real issue: Nissan had misread the market.

While the world went hybrid, Nissan had gone all-in on EVs.
The company discontinued its Rogue Hybrid in 2020, betting that electric cars would soon dominate.

They were wrong.

Hybrid demand exploded — up 53% in 2023 in the U.S. alone — while Nissan had none to offer.

The result? Profits collapsed 99%, falling to just $6.5 million.
Thousands lost their jobs, factories shut down, and Nissan even sold its Mitsubishi stake to stay afloat.

The Desperate Deal with Honda

With Nissan spiraling, Uchida looked for help.
Enter Honda.

Unlike Nissan, Honda wasn’t just an automaker — it was a diverse powerhouse with divisions in motorcycles, marine engines, and even private jets. Its market cap was nearly five times Nissan’s.

Talks began in late 2024 to form a new Japanese auto supergroup by 2026.

Honda’s motivation? Fear of China’s fast-growing EV makers like BYD. A merger could make Honda and Nissan the third-largest auto alliance in the world, behind Toyota and Volkswagen.

But the talks quickly soured.

Honda wanted to close Nissan’s unprofitable plants — Nissan refused.
Negotiators described Nissan’s management as “slow” and “overly proud.”

Then came the final blow: Honda revised the deal.
Instead of an equal merger, Nissan would become Honda’s subsidiary.

For Uchida, this was humiliation.
On February 6, 2025, he told Mibe the merger was off.

Within weeks, Nissan’s stock plummeted 80%, dropping below $3.
Renault called the deal a “takeover without a premium.”
Analysts said it bluntly: “Honda doesn’t need Nissan — Nissan needs Honda.”