Shares in Nissan Motor Co. slumped about 6% on Tuesday after Mercedes-Benz announced plans to sell off its roughly $346 million stake in the Japanese automaker, adding fresh pressure on a company already grappling with steep losses and declining sales.
At 2 pm in Tokyo, the shares were down by 5.98% at 341 yen, down from Monday’s close of 363 yen, putting them on track for their sharpest single-day decline since early July.
The stake, representing 3.8% of Nissan, is expected to be sold at a discount of up to 7% compared to Monday’s closing price, according to a term sheet.
Investor scepticism deepens over turnaround
The selloff underscores growing scepticism among investors about Nissan’s ability to execute a credible turnaround strategy.
The company booked a $535 million loss for the quarter ending June, weighed down by weaker demand in its key US and Chinese markets, as well as the lingering impact of US auto tariffs.
CEO Ivan Espinosa, who took over in April, has pledged sweeping restructuring measures aimed at restoring profitability.
The plan includes cutting global production capacity to 2.5 million vehicles from 3.5 million by fiscal 2027, reducing the number of manufacturing sites from 17 to 10, and slashing 11,000 jobs.
Espinosa said last month that Nissan was still in the early stages of recovery, but pointed to progress in cost reductions as a sign the plan was beginning to take hold.
‘Nissan stake not of strategic importance’: Mercedes-Benz
Mercedes-Benz said the decision to offload the Nissan stake, which was placed into its pension assets in 2016, was part of a portfolio cleanup.
A company spokesperson stressed that the holding was not strategically significant, noting that it accounts for just 2.7% of the group’s total pension assets, compared with nearly 93% tied up in Daimler Truck.
Nissan, for its part, declined to comment on the sale.
The Japanese automaker itself divested its 1.5% stake in Mercedes, then Daimler AG, in early 2021 as it scrambled to shore up finances amid mounting losses.
Tariffs, sales decline and failed talks weigh on Nissan
The share drop adds to the strain on Nissan’s stock, which has fallen more than 29% so far this year.
The company continues to face pressure from global competition, especially from Chinese automakers in the electric vehicle segment, as well as fluctuating US tariff policies.
While tariffs on Japanese autos were reduced in July from an initially planned 25% to 15%, providing temporary relief, the market outlook remains uncertain.
Nissan’s short-lived talks with Honda over a possible merger that could have created the world’s third-largest automaker collapsed earlier this year, further denting confidence.
With investor patience running thin, Espinosa’s challenge now is to convince markets that Nissan can stabilize operations and compete effectively in a rapidly shifting global auto industry.
The post Nissan shares slump 6% after Mercedes-Benz stake sale move appeared first on Invezz