The automotive giant Nissan faces another setback with the announcement that it will be closing a series of showrooms for its luxury division, Infiniti.

According to data from Statista, Nissan globally reported a net profit of approximately 426.7 billion yen for 2024.

Reports indicate that Infiniti will shutter several standalone locations in the United States and merge operations with existing Nissan dealerships across the country.

This decision comes on the heels of insider revelations last month that Nissan had “12 months to survive” after major European investor Renault announced plans to reduce its stake in the company.

A week later, Nissan’s Chief Financial Officer, Stephen Ma, became the first casualty of the brand’s highly publicized financial troubles.

Infiniti’s decision coincides with reports that its U.S. sales have dropped by more than 50% over the past five years. The luxury brand currently serves 197 dealerships in the U.S., but each site averages only 24 vehicles sold per month.

Infiniti disclosed that it sold just 42,567 new vehicles in the U.S. in the nine months up to September of this year, compared to 87,934 units during the same period in 2019.

Nissan North America’s Vice President for Dealer Network Development told Automotive News that Infiniti’s restructuring aims to ensure the brand’s survival.

“Our evaluation prioritizes the health of retailers and the Infiniti business,” he said.

“We also considered expected sales, the cost and availability of automotive real estate, and the size of existing facilities, among other factors,” he added.

Infiniti’s struggles are just the latest setback for the Japanese giant following the fallout from Renault’s disclosure in November.

Experts warn that Nissan, one of the top-selling car brands in Australia, has only one year to survive as the company seeks to fill the financial void left by Renault’s departure.

Reports suggest that Nissan is searching for a new investor to ensure its survival beyond 2025.

Two individuals familiar with the talks revealed that Nissan is seeking a long-term, stable shareholder, such as a bank or insurance group, to replace part of Renault’s equity stake.

“We have 12 to 14 months to survive,” a senior official close to Nissan stated.

This news was swiftly followed by Ma’s resignation on December 3, just days after the announcement.

Ma’s departure comes in the wake of other leadership losses, including Chief Operating Officer Ashwani Gupta in 2023 and the dramatic arrest of former CEO Carlos Ghosn in 2018.

Nissan CEO Makoto Uchida will also cut his monthly salary by 50% as the automaker continues implementing measures to stabilize its finances.

The company has pledged to reduce costs, sell assets, and prioritize investments in research and development.

Uchida emphasized, “These recovery measures do not imply that the company is downsizing.”

“Nissan will restructure its operations to become more efficient and resilient while reorganizing management to respond quickly and flexibly to changes in the business environment,” he said.

“Our goal is to enhance the competitiveness of our products, which are essential to our success, and to put Nissan back on a growth trajectory.

“As a cohesive team, we are dedicated to working together to ensure the successful implementation of our plans.”

Nissan is not alone in its crisis, as several other automakers face challenges stemming from a shift to electric vehicles, heightened competition, and weak customer demand.

For instance, Carlos Tavares, CEO of Jeep’s parent company Stellantis, also resigned this month.

Volkswagen is dealing with strikes in Europe amid plans to close factories as its vehicles transition from gasoline to electric power.

Other giants like Ford and General Motors have struggled to balance investments in electric vehicles with maintaining traditional model production.

Last week, GM reported a staggering $8 billion loss due to declining demand and profitability.

GM’s sales and market share have been gradually eroding as competition from local automakers intensifies in China.

The reported loss includes $5 billion in restructuring costs and a $2.7 billion impact from GM’s joint venture with Chinese state-owned SAIC Motor.

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