Under new CEO Ivan Espinosa and after a failed merger attempt with Honda, Nissan is trying to turn things around. That means mass layoffs, pausing work on some new models, and now, asking suppliers if they’ll take an IOU.
Reuters reports that Nissan is asking some of its suppliers in Europe and the UK if they’ll accept delayed payments to free up some needed cash. This isn’t an unusual move for an automaker, and Nissan told Reuters it’s offering suppliers the option of taking payments right away, or at a later date with interest. If the supplier decides it wants immediate payment, HSBC will pay the supplier, then Nissan will pay back the bank with interest at a later date.
Espinosa’s stated goal is to achieve $3.4 billion in cost cuts over the next two years. Over the last fiscal year, Nissan lost $4.5 billion. Its aim to delay supplier payments in the UK and Europe could help it free up $69 million in cash. In total, Nissan has around $15 billion in cash, but nearly $5 billion in debt coming due. The automaker is also reportedly considering selling its $700 million Yokohama headquarters, possibly leasing the space back from the buyer.
Meanwhile, Nissan is moving ahead with lots of new products. It recently revealed the new Leaf EV, and in Europe, it now has the Renault 5-based Micra. The automaker also told Engine recently it’s trying to revive the Xterra to compete against the extremely popular Toyota 4Runner.
