Tokyo, Japan – November 14, 2025 – S&P Global Ratings has downgraded the long-term credit rating of Nissan Motor Co. (7201.T) from BB to BB-, citing ongoing pressures on profitability and a challenging outlook for the Japanese automaker. The rating revision applies to both Nissan and its overseas subsidiaries, reflecting a cautious view on the company’s financial health.

Reasons Behind the Downgrade

In its statement, S&P highlighted several factors contributing to the downgrade:

• Reduced competitiveness in key markets: Nissan has faced growing competition from global rivals, impacting market share and sales volumes.
• Operational inefficiencies: Rising costs and challenges in streamlining operations have put additional pressure on margins.
• Inflationary and tariff pressures: Increased tariffs, rising raw material costs, and higher operational expenses have constrained profitability and slowed performance recovery.

“Tariff costs, a challenging competitive landscape, and rising expenses under inflationary pressures serve as headwinds to Nissan’s performance recovery,” S&P noted, underscoring concerns about the automaker’s ability to sustain profitability in the near term.

Broader Implications for Nissan

The downgrade signals heightened credit risk for Nissan, affecting investor confidence and potentially increasing borrowing costs. Analysts warn that unless Nissan addresses operational inefficiencies and strengthens its competitive position, further rating pressures could materialize.

Nissan has historically been a major player in the global automotive industry, with a strong presence in markets such as Japan, the United States, and Europe. However, rising competition from both traditional automakers and electric vehicle startups is challenging its market position.

The rating adjustment also highlights broader pressures on Japanese automakers navigating inflation, fluctuating supply chains, and evolving consumer preferences. Investors and industry watchers will be closely monitoring Nissan’s financial performance, cost-management strategies, and product innovations to assess recovery prospects.

Outlook

S&P’s downgrade of Nissan to BB- reflects caution in the face of current operational and market challenges. While the automaker continues to focus on strategic initiatives, including expansion into electric and hybrid vehicles, the company will need to enhance efficiency, manage costs, and strengthen market competitiveness to stabilize its credit profile.