Nissan is in deep trouble, posting huge losses, shutting factories and laying off workers, and some analysts trace the problems all the way back to the tenure of Carlos Ghosn, who ran the company for more than 15 years.

They argue that aggressive expansion by the iconoclastic executive left the company overextended, and that the journey back to a manageable and profitable size will be difficult.

¡°Until Ghosn left the company, Nissan was aggressively pursuing global expansion. It has not been easy to abruptly shift that strategy and scale it down,¡± said Yasushi Yokoyama, a senior analyst at Aizawa Securities.

¡°It seems the company is facing its adverse impact.¡±

In 2011, Ghosn announced that Nissan, which had less than 6% of global unit sales in the auto industry, would boost that share to 8% in six years.

The company boosted production capacity, which left Nissan with the excess capacity it is burdened with now.

Nissan¡¯s global unit sales plunged to 3.3 million last fiscal year compared to the peak of 5.8 million in fiscal 2017.

The company sold 1.6 million in the United States in fiscal 2017, but the figure plummeted to 938,000 in fiscal 2024. In China, the unit sales fell to 697,000 in fiscal 2024, compared to 1.5 million units in fiscal 2017.

Another legacy of the Ghosn era is a culture of pursuing short-term profit and efficiency, according to Atsushi Osanai, a professor at Waseda Business School.

This has led to lackluster investments in electric vehicles and caused Nissan to lag behind Chinese automakers, while the company has also failed to establish an effective internal structure to produce competitive vehicles, Osanai added.

¡°Nissan has design prowess and possesses a range of internal combustion engine technologies, so I believe Nissan is capable of making competitive cars, but has been failing to do so,¡± he said.

¡°Considering the capability of front-line workers, if they had effectively integrated their technology and product planning, I think things wouldn¡¯t have turned out this way.¡±

Nissan¡¯s new management team, led by CEO Ivan Espinosa, who took the helm in April, appears to be well aware of the issue and what needs to be done.

¡°The reality is clear,¡± Espinosa said last week at a news conference. ¡°We have a very high cost structure. To complicate matters further, the global market environment is volatile and unpredictable, making planning and investment increasingly challenging.¡±

Nissan reported a net loss of ?670 billion ($4.5 billion) in fiscal 2024. It is the third-biggest annual loss in Nissan¡¯s history.

The focus now is on whether Espinosa and his team will be able to turn the situation around.

Some analysts said the previous management team was largely...