By John Meyer, consultant in financial affairs – Eurasia Business News, February 21, 2025. Article No 1423.

Moody’s Ratings has downgraded Nissan Motor’s credit rating to junk status, cutting its senior unsecured rating from Baa3 to Ba1, while maintaining a negative outlook. This decision reflects concerns over Nissan’s weak profitability and the challenges it faces in implementing its new restructuring plan, which includes significant job cuts and production capacity reductions.

The downgrade comes amid a backdrop of declining demand for Nissan’s aging vehicle lineup, particularly in key markets like China and the U.S. The company has been struggling with high inventories and the absence of competitive hybrid models in its U.S. offerings. Moody’s analysts noted that these factors contribute to a worsening credit profile, with expectations of continued negative free cash flow and operating profit margins through fiscal 2025.

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Additionally, the recent termination of merger talks with Honda has further deepened uncertainty around Nissan’s future strategies. The restructuring plan aims to cut costs by approximately JPY 400 billion (around $2.7 billion) by the end of fiscal 2026, but execution risks remain high, especially given the current global trade environment that may affect Nissan’s operations.

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© Copyright 2025 – Eurasia Business News. Article no. 1423.