### Renault Faces $11.2 Billion Loss on Nissan Stake Amid Accounting Changes Renault, the French automotive giant, has announced it will report a staggering loss of approximately €9.5 billion (around $11.2 billion) for the first half of 2025. This extraordinary loss is attributed to a significant shift in how the company accounts for its investment in Nissan Motor, a long-time partner. The decision to change accounting methods comes as both companies are experiencing a loosening of their historically intertwined relationship, which has been marked by challenges in recent years, including Nissan's declining sales and outdated vehicle lineup [https://www.manilatimes.net/2025/07/02/business/foreign-business/renault-to-report-112-b-h1-loss-on-nissan-stake/2141596][https://www.reuters.com/business/autos-transportation/renault-report-112-billion-loss-nissan-stake-first-half-2025-07-01]. ### Breakdown of Renault's Loss and Its Implications 1. **Nature of the Loss**: Renault's reported loss is a non-cash write-down on its 35.7% stake in Nissan, reflecting a shift to a share price-based accounting method. This change highlights the deteriorating financial health of Nissan, which has been struggling with weak sales and a significant loss of its own [https://www.financialexpress.com/auto/car-news/renault-to-report-11-billion-loss-on-nissan-what-went-wrong/3899280][https://www.channelnewsasia.com/business/renault-report-112-billion-loss-nissan-stake-first-half-5213386]. 2. **Impact on Partnership**: The financial strain adds to the existing tensions in the Renault-Nissan alliance, which has been fraught with difficulties since Renault's rescue of Nissan in 1999. The two companies have maintained cross-shareholdings, but recent developments suggest a potential shift towards reducing these ties [https://www.freemalaysiatoday.com/category/business/2025/07/01/renault-books-e9-5bil-loss-on-nissan-shares][https://www.financial-world.org/news/news/financial/28426/renault-to-write-down-eur95-billion-on-nissan-stake-amid-share-price-drop]. 3. **Market Context**: The market value of Nissan has plummeted, currently estimated at about 1.3 trillion Japanese yen (approximately $9.1 billion), which has directly influenced Renault's financial reporting and investment valuation [https://www.indexbox.io/blog/renault-to-report-95-billion-non-cash-loss-on-nissan-stake][https://asia.nikkei.com/Business/Automobiles/Renault-to-report-11bn-loss-on-Nissan-stake-in-first-half-of-2025]. ### Supporting Data and Financial Metrics - **Loss Amount**: €9.5 billion ($11.2 billion) non-cash loss on Nissan stake. - **Ownership Structure**: Renault holds a 35.7% stake in Nissan, with 17.05% directly owned and the remainder through a trust [https://www.business-standard.com/world-news/renault-to-report-11-billion-loss-on-nissan-stake-in-first-half-this-year-125070100717_1.html]. - **Nissan's Financial Health**: Nissan reported a loss of $4.5 billion, indicating significant operational challenges [https://www.financialexpress.com/auto/car-news/renault-to-report-11-billion-loss-on-nissan-what-went-wrong/3899280]. ### Conclusion: A Pivotal Moment for Renault and Nissan In summary, **Renault's decision to report an $11.2 billion loss on its Nissan stake marks a critical juncture for both companies**. The shift in accounting practices reflects deeper issues within the partnership and the automotive market at large. 1. **Financial Reporting**: The loss is a direct result of changing accounting methods, emphasizing Nissan's declining market value. 2. **Partnership Strain**: The financial difficulties are exacerbating tensions in the Renault-Nissan alliance, which may lead to further restructuring. 3. **Market Implications**: The ongoing challenges faced by Nissan could have long-term repercussions for Renault's investment strategy and overall financial health. As both companies navigate this turbulent period, their future collaboration remains uncertain, with potential implications for the broader automotive industry [https://www.wsj.com/business/autos/renault-to-book-11-billion-hit-from-changes-in-accounting-treatment-of-nissan-stake-526c8827][https://fortune.com/europe/2025/07/01/renault-11-2-billion-loss-nissan-stake-adds-to-tensions-rocky-partnership].