Part 6/8:
Looking deeper, Nissan faces grave risks impacting its core businesses in its two most critical markets: the United States and China. Repercussions of any forthcoming tariffs, particularly threats of a 25% tariff on vehicles made in Mexico, could cripple production and severely hurt profit margins. With a considerable portion of its cars produced in Mexico, such tariffs might force Nissan to raise prices and ultimately alienate them from potential buyers, especially given the current excess inventory of outdated models.
Rising interest rates on the company's debt only serve to complicate matters further. As Nissan's debt ratings hover at junk status, it incurs higher borrowing costs than its competitors, squeezing profit margins even tighter.