A high-level Japanese delegation, including former Prime Minister Yoshihide Suga, is pushing for Tesla (NASDAQ: TSLA) to invest in Nissan (OTCPK: NSANY) following the collapse of merger talks with Honda (NYSE: HMC), according to a Financial Times report.
Tesla as a Strategic Investor in Nissan?
The initiative, led by former Tesla board member Hiro Mizuno, seeks to position Tesla as a key investor in Nissan, with a particular focus on acquiring its U.S. manufacturing plants. This potential move comes as Nissan faces growing financial pressure and looks for strategic alliances to stabilize its operations.
Why Nissan Needs Tesla’s Investment Now
Nissan’s failed merger discussions with Honda last week have intensified the company’s search for new partnerships. The automaker is grappling with weak profitability, an aging vehicle lineup, and declining market share, making a Tesla investment an appealing lifeline.
Following the news, Nissan’s stock surged 10% on the Japanese stock exchange, signaling investor optimism about a potential deal with Tesla.
Moody’s Downgrades Nissan to Junk Status
Adding to Nissan’s financial woes, Moody’s has downgraded the company’s credit rating to junk status, citing ongoing struggles in profitability. The credit agency warned that even if Nissan successfully implements cost-cutting measures and new model launches, the company is unlikely to see positive free cash flow before 2026.
“Nissan’s weak profitability is driven by slowing demand for its aging model portfolio,” Moody’s stated, highlighting the urgency for Nissan to secure a major partnership.
What’s Next for Tesla and Nissan?
With Nissan seeking a strong global partner, Tesla’s potential investment could reshape the competitive landscape in the EV and automotive industry. If Elon Musk’s company proceeds with this strategic move, it could gain access to Nissan’s infrastructure and workforce, giving Tesla a manufacturing edge in the U.S. market.
The auto industry is now closely watching whether Tesla seizes this opportunity to expand its influence in Japan and beyond.
