Nissan's Future Is About To Be Decided

Details are coming this week.

Even before the coronavirus pandemic struck, Nissan was in a difficult position. Profits were way down partly due to a lack of new products in the most important markets, specifically North America and China. But prior to now-former CEO Carlos Ghosn's arrest, there were plans for Nissan to merge with Renault.

Currently and at the time, the automakers (along with Mitsubishi) are part of a global alliance that had been rather successful for years. But Ghosn wanted Renault and Nissan to merge for numerous reasons, and apparently not everyone was happy about that. Given the current tough times for both companies, are those merger plans now back on? Nope.

Reuters now reports merger plans have been shelved, possibly for good.

Instead, Nissan and Renault aim to repair their alliance. Later this week, both companies will announce their respective restructuring plans which, apparently, have been done in coordination with each other. Call it a peace treaty, if you will. The aim is to resolve old tensions that have gone on for far too long.

The repaired alliance will also include Mitsubishi. These restructured plans, however, will likely include job cuts as well as product changes in some markets. The Nissan GT-R and Nissan 370Z (plus its upcoming successor) have already been rumored to be discontinued in Europe.

Going forward, the alliance aims to have what's being described as a "leader-follower" system, meaning one company will develop a type of vehicle or technology with the other following. Each company has certain strengths and weaknesses regarding technology and architectures, so things should even out in terms of development. At the moment, Renault has a 43.4 percent controlling stake in Nissan, while Nissan has a 15 percent non-voting stake in Renault.

Will this lead to Renault selling its own vehicles in the US one day? It's simply too soon to know for sure, but there's a very good chance some future Nissans could have Renault underpinnings.