They must really be in deep doo-doo.
https://www.motor1.com/news/760701/nissan-sell-headquarters-report/
Makes the Honda merger look even better. The alliance may have rationalized the Nissan lineup in much the same way as proposed in the article, and may not have shut down the two plants. I imagine Renault has a major say in both situations.
Nissan didn’t want to be a subsidiary. They wanted a merger of equals. What were they smoking? Always need to remember the golden rule “He who has the gold makes the rules”.
Honda was smart. Nissan management would have wanted influence. Not!
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From my limited research, when two companies merger, one strong and one circling the drain, both end up going down the drain. But I don’t know of any mergers in Japan like this so it might turn out different.
What happens is that the executives in the poor performing company have survived many “cut backs”. They know how to keep their positions while forcing better managers out. The strong company has not had to deal with cost cutting and reductions in staff so the executive there are not prepared for this environment. When the merger happens, there will be an excess of management and executives, and guess who is best prepared to survive.
A recent example is Boeing. When Boeing merged with McDonald Douglas, it is the old MD execs who ran MD into the ground now running Boeing into the ground, like a 737 Max with MTACS.
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Boeing was much larger than MacDak. There’s no way that the significantly smaller parter was going to take over. Both Honda and Nissan are large and the comparison loses some applicability. IMO Honda wouldn’t budge on who would be the senior partner and that led to termination of the merger.
There are several examples of a strong company taking over one circling the drain that worked out very well in the tech industry and audio industry.
The one that comes readily to mind is the Packard/Studebaker “merger”. Packard actually bought Studebaker, but they wouldn’t have done it if they hadn’t been shown books that were “cooked” to make Studebaker look like it was in better financial shape than it really was.
They merged in 1954, and w/in 2 years there were no more Packards. Fast forward another ten years, and Studebaker disappeared from the marketplace.
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And yet, that is exactly what happened. Boeing was run by engineers, MD was run by businessmen and relied mostly on government contracts. The got used to being bailed out by the government.
One example before the merger, Boeing developed (at their own expense) a 747 tanker for inflight refueling. The demonstrated to the Air Force who immediately saw its advantages over the KC-135, a variant of the Boeing 707. But powers that be in the government overruled the Air Force and ordered the Air Force to buy a variant of the DC-10, now called the KC-10. The KC-10 did not have the range or capacity of the 747, but the businessmen at MD knew how to harness political power.
When Boeing and MD merged, Boeing had a lot of government contracts that the engineers at Boeing did not know how to administrate. That is how so many managers at MD survived the merge and they began to displace the engineers in management positions.
Fast forward to today, all or almost all of the original engineer/managers are gone and Boeing is being run by the survivors from the merge. And now Boeing has poorly designed products and poor quality control.
The MCAS in the 737 Max is an example of really bad engineering. Even a boot engineer knows that you NEVER install a system that takes control of an aircraft from the pilot. I have to wonder how they got that concept past the FAA, but I guess that is what political juice does for you.
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I did a study on Douglas profitability starting with 1959 when the first DC-8s got delivered. (As a standalone before the McD merger and as a commercial segment after up until the BoMc merger.)
Douglas Commercial barely broke even over the years. Averaged about $10 mills a year. About 1 jet’s worth. Then in 1995 they took a bath and booked a $1.8 bill loss almost all on the MD11. They merged with Boeing in 1997.
How/why Boeing let McD run the show was a mystery to me. Your eloquent analysis shed the light for me. Thank you.
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If you like doing studies on this type thing, I think you would find ITT very interesting. In the 1980’s, the were one of the largest if not the largest corporation in the world. They were mostly know as a telecom company, the second largest in the world, AT&T was the third largest.
They began to buy up other corporations and soon were into every thing. In their pursuit to be in every thing, they bought up a small laser printer company in silicone valley. As a prat of the deal, the owner of that company became the CFO of ITT. Soon after, ITT started to unravel. It sold its telecom division to Alcatel (France). There were three main product lines in the telecom division, PBX (office phone systems), call center PBX (a larger version of the office phone system mostly used by help lines and robo-callers) and central office switches (where your old land line connected to).
The central office line was developing the most advanced central office in the world and that is what Alcatel wanted. BTW, it never made it to production as Alcatel told all the engineers on the project that as soon as they were finished, they would be terminated, so guess what, they never finished.
Alcatel sold off the other two lines, to, guess who, the former CFO and previous owner of the printer company. He formed two separate companies, a call center company called BCS and a PBX company called Cortelco. I worked for Cortelco.
Cortelco was a well run little company that grew into the 6th largest PBX company in the US and gaining. BCS, not so much. They were struggling. So the owner decided to merge the two companies, named to new company EON, and go public. Somehow it wasn’t long before the sharks at BCS took over and pushed out everyone at Cortelco. I lasted about three months after the merger. The stock dropped faster than a fat man without a parachute, I lost a s*** load of money on that deal.
Eventually the merged company was circling the drain when it got bought up by another company that was also circling the drain and as far as I know both are now gone.
BTW, last I heard, the FAA is still using the BCS call center switches for their telephone system.
Thanks! ITT. What a fallen flag.
Nissan’s variable compression engine, the gift that keeps on giving:
Nissan recalls over 440,000 vehicles. See the impacted models.
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Nissan is definitely a second-fiddle car company, imo
For me to ever consider buying a Nissan, you’d have to practically give it away AND hold a gun to my head
Their reputation is in the toilet 
. . . as far as I’m concerned
And they need to get off their high horse, swallow their pride and accept that reality
Until they do and are willing to accept the junior role in any partnership, takeover, etc., they’ll continue to be in free-fall, by my estimation
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And, another struggling car company–Mitsubishi–has hitched itself to that Nissan horse. The only “new” models that Mitsubishi has been able to introduce over the past few years have been restyled Nissan models.
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My 2020 Nissan Frontier 3.8 V-6 with 47k miles is at the dealership for a new engine due to a failed rod bearing. On the Frontier forum, there are 14 trucks with the build date of 08-20 that have had the same problem and one with the build date of 09-20. It doesn’t seem to affect truck built before or after.
This is opposite my experience. The larger company’s board of directors will choose who stays and they almost always choose the old shoe. As noted, they have been successful whereas the absorbed company is struggling. From the director’s viewpoint, this is a failing by the management team. Why would they keep a failing manager over one they know and has a good track record? What typically happens is that the old executive management team is decimated after a short period (where they insert their incumbents to learn the ins/outs) and then the head honcho is given a token position on the board or is named as an advisor. After a year, it’s sayonara…
Been through this numerous times in my career. Going through another right now. The entire senior executive team has been displaced now, almost exactly one year after the new investors took over. The most humorous line came from a big company that bought our vigorously growing enterprise for a huge multiple (yay!). Why would we change anything? You’re a growing, going company…We have no plans to make any changes… Right. You have no plans, you have ideas. The plans will come later 
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I’ve been through three changes of ownership with companies I worked for. In the first one, the company had a strong relationship with NASA and thought that they couldn’t lose the contract rebid. They did, and it looked like the company would go under. The stock was sold to the employees over a long period before that through an ESOP. When the Big Contract was lost, the Chairman, who had been one of the original three owners, worked to find a buyer. Not only did he find a buyer, he found one at the valuation before the lost contract. The new owner didn’t want to change anything and let it run, just as they had with another couple of companies they bought.
That company eventually merged with a larger company and the operation I worked for was closed. I was already gone by then.
The third company is the one that won that contract I mentioned in the first paragraph. It was a very well run company, though not the best I ever worked for. The best managed company bought the third company. The president and owner of the third company stuck around for a year, then took off and started another successful company. He has since started another couple of companies and is now a billionaire. He still owns all three.
Looking back over the decades, this is kind of sad and pathetic to watch
afaik . . . if I’m wrong, please feel free to correct me . . . in the 1980s, Nissan products were okay, definitely below Honda and Toyota levels, but not complete garbage
Mazda and Subaru were also a step below Honda and Toyota. In fact, wasn’t Subaru more of a niche market player at the time?
But look where Mazda and Subaru are now. Subaru is definitely an established player, building good vehicles, a mainstream player. And Mazda has also come a LONG way, imo
But Nissan hasn’t really gotten anywhere, as I see it. They’re still building clearly inferior and outdated vehicles and they’re not really in a position to survive by themselves, as I see it
Nissan’s free-fall was a long time coming, imo
My thoughts echo yours.
A friend of mine had a Maxima in the late 80s/early 90s, and it was a very nicely performing car, plus it was also very reliable and durable.
I can only guess that Nissan’s management was not as competent as they should have been.
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It’s not the variable compression engine that is under recall. It is the turbocharged, direct injected engines that are being recalled. They suffer from something called LSPI, low speed pre-ignition. At low speed, high load, the pressure from the turbo gets so high it causes pre-ignition in an already high pressure cylinder still on its compression stroke. The result is devastating on the pistons, rods and rod bearings.
Leading edge technology, sometimes becomes the bleeding edge technology.