Nidec Shares Plunge on Report of $6.3 Billion Impairment Charge

Nidec Corp shares plunged on Monday after a report said the Japanese precision motor manufacturer could book a massive 1 trillion yen ($6.3 billion) impairment charge, adding to concerns over its prolonged accounting and management crisis.

Japanese publication Diamond Online reported that Nidec is expected to record the impairment for the fiscal year ended March 2026. The potential charge could effectively erase the cumulative profits the company generated over the past decade, according to the report.

Nidec shares dropped as much as 18% to 2,405 yen following the news. The company is the world’s largest manufacturer of precision motors and a major supplier to the global automotive industry.

The report also said Nidec has decided to dismiss President Mitsya Kishida, with the leadership change expected to be announced on September 29.

Nidec has been dealing with mounting corporate governance challenges since disclosing several cases of improper conduct last year. The problems prompted the company to announce a series of impairment charges, although the reported 1 trillion yen write-down would be its largest to date.

Earlier this year, Nidec also revealed improper practices related to quality control, further increasing scrutiny of the company’s internal management and oversight.

The continuing accounting scandal has dealt a major blow to Nidec’s reputation. The Kyoto-based company has long played an important role in the automotive supply chain, providing motors and related technologies to manufacturers worldwide.

The turmoil has also affected Nidec’s standing in Japan’s equity market. Its shares were removed from the benchmark Nikkei 225 index, while the company also faces the possibility of delisting.

Investors are now watching for Nidec’s response to the reported impairment charge and potential management shake-up. Any official announcement could provide further clarity on the financial impact of the accounting issues and the company’s plans to restore confidence in its governance and operations.