Nissan Power Finance: $1.8M in Cash and Stock Options
Nissan Power finance is a new business venture for Nissan Motor, which is looking to use its growing brand to generate revenue.
The company will use its vast automotive supply chain to provide a range of services for its suppliers including energy, finance, supply chain, logistics and automotive engineering.
Nissan Power has set a goal of $1 billion in revenue by 2019, which would give it a market capitalization of $11.8 billion.
The new business is expected to begin operations in early 2018.
The company has partnered with private equity firm MBIA Capital to invest $1 million in the business.
This investment will be used to create the new entity, which will work as a wholly-owned subsidiary of Nissan Power and be focused on Nissan’s core automotive business, said a Nissan executive.
The funds will also go towards expanding the company’s global reach and bringing its manufacturing footprint to more markets, the executive added.
While the acquisition will be in the automotive space, it will also focus on the finance, power and finance business, the company said.
Nissan Finance, which started operations in January, has the potential to grow to $3 billion by 2020, according to the company.
Nissan’s finance business has grown from $300 million in 2015 to $1 trillion in 2019, according the company, which expects to see growth in both sectors as it expands its business model.
The automotive industry has seen growth over the past few years, with the U.S. auto industry reaching a record $12.3 trillion in revenue in 2020, up from $11 trillion in 2015.
The U.K. is also looking to expand its automotive supply chains, and the British government is investing $6.5 billion in the sector over the next five years.
Nissan has been one of the biggest suppliers of vehicles for British manufacturers, particularly Mercedes-Benz and Volvo.
The firm also provides finance for Mercedes- Benz.