Nissan’s attempt to sell a whopping $500 million in auto loan bonds is the first sale of bonds since U.S. Treasury Secretary Henry Paulson moved off of his focus of the auto industry rescue package. Nissan is taking matters into their own hands, it seems, and will hope to raise $500 million with the sale of the bonds in order to assist in their own personal bailout process.
Bloomberg is reporting contact with an official at Nissan that has some “insider information.” According to this individual, “a top-rated debt portion of the Nissan issue will mature in July 2012 and is expected to yield 400 basis points more than benchmark interest rates.” For the record, a basis point is 0.01 percentage point.
Top officials at Nissan are banking on the sale and many believe that this indicates the Paulson’s unlocking of consumer-related credit markets may be working. If this frees up more capital for consumers and dealerships, the end of the economic struggles may be drawing near. Companies like Nissan may try similar procedures in hopes of freeing up some of their own cash and avoiding government/taxpayer bailouts and bankruptcy proceedings.
How this will impact local area Nissan dealerships remains to be seen, but Nissan 2008 models are still moving relatively well and the company continues to do well in most markets.



