Nissan Sells $630 Million Headquarters Amid $1.4 Billion Loss: Inside the Automaker's Recovery Strategy

Nissan disclosed a substantial 221.9 billion yen ($1.4 billion) loss for the first fiscal half on Thursday.

The troubled Japanese automaker Nissan announced Thursday its decision to sell its headquarters building located in Yokohama, southwest of Tokyo, for 97 billion yen ($630 million) as part of its ongoing revival strategy.

Nissan Motor Co. will continue to operate from the building through a lease arrangement, while recording 73.9 billion yen ($480 million) as profit from the sale to Tokyo-based real estate operator MJI Godo Kaisha, according to their statement.

The proceeds will be directed toward modernizing internal systems at their headquarters and accelerating digital transformation and AI-driven systems implementation, explained Nissan, the manufacturer of the March subcompact and Infiniti luxury vehicle lines.

MJI Godo is a special purpose trust owned by the Minth Group, a prominent auto parts manufacturer listed on the Hong Kong stock exchange. The lease cost details were not revealed.

In the same announcement on Thursday, Nissan reported a 221.9 billion yen ($1.4 billion) loss for the fiscal first half, a stark contrast to the 19.2 billion yen profit recorded during the same period last year. The company did not provide a full-year net profit forecast.

During the six months through September, Nissan's sales decreased by nearly 7% to 5.58 trillion yen ($36 billion).

The automaker has been facing challenges in restoring profitability after reporting a 670.9 billion yen ($4.4 billion) loss for the fiscal year ending March.

Nissan has committed to a turnaround under new chief executive Ivan Espinosa, a Mexican executive with two decades of Nissan experience who assumed leadership earlier this year.

Nissan's global vehicle sales declined in the first half, particularly in Japan. However, the company reported improving sales in China and the U.S., and mentioned that upcoming new models are expected to drive sales growth.

"Nissan is on track," Espinosa assured reporters following the earnings announcement. "We remain focused on recovery."

The headquarters sale represents the company's strategy to innovate, maintain competitiveness, and actively pursue research for future growth, according to Nissan.

"This move reflects a disciplined approach to capital efficiency unlocking value from non-core assets to support transformation during the challenging years," the company stated regarding the sale.

Nissan has previously announced plans to reduce its global workforce by 15%, equivalent to approximately 20,000 employees. The company is also shutting down its flagship factory in Oppama, Japan. All Japanese automakers are currently facing pressure from President Donald Trump's tariffs.

Nissan shares, which have been declining over the past year, decreased to 337 yen ($2.19) from 344 yen ($2.23) the previous day.

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Yuri Kageyama is on Threads: