According to media reports, on July 1, Renault SA announced it would record a non-cash loss of approximately €9.5 billion (equivalent to $11.2 billion) after adjusting the accounting method for its stake in the struggling Nissan Motor Co.
Renault stated that the new accounting approach will link the valuation of its Nissan holdings to Nissan's share price. Over the past 12 months, Nissan's stock has plummeted by 38%. However, Renault emphasized that the adjustment will have no cash impact on the company and will not affect how dividends are calculated.
The new accounting method for Nissan shares takes effect as of June 30, 2025. Under Renault's updated financial policy, the long-term equity investment previously accounted for using the equity method will now be measured at fair value, with changes recognized in other comprehensive income. The valuation will be based on Nissan's market share price.
In a statement, Renault said: "While this change in accounting treatment will have a significant impact on the Group's financial statements, it does not alter the strategic and operational commitments between Renault and Nissan."
Renault further noted that, under the new strategic plan announced on March 31, 2025, the two companies will continue to collaborate on joint industrial and technological development projects. These efforts reflect a pragmatic, business-driven partnership, while allowing each side to retain operational flexibility and efficiency.
However, with intensifying market competition and growing mistrust between the partners, the Renault-Nissan Alliance is gradually loosening its existing cooperative framework. Nissan currently faces a triple challenge: urgently improving its financial health, updating its aging product lineup, and coping with market disruptions caused by the U.S. Trump administration's tariff policies.
Meanwhile, Renault is in the process of selecting a new CEO to succeed Luca de Meo, who will soon become the CEO of Kering SA, the luxury group behind brands such as Gucci.
At Nissan's annual shareholder meeting last month, new CEO Ivan Espinosa faced tough questions from shareholders about the viability of his turnaround plan and the company's failed collaboration with Honda. With approximately ¥800 billion ($5.6 billion) in debt maturing next year, Nissan is currently seeking financing to maintain operational stability
