Last week, as Nissan finally reached a historic deal with Renault to reset their troubled alliance, the subtext was clear. The Japanese electric vehicle pioneer is facing an existential crisis in China, and this is no time for infighting.

Global auto giants, including Japanese carmakers, have been caught badly off-guard by the rapid shift away from the internal combustion engine and the rise of China’s homegrown electric vehicles groups.

Sales of Japanese cars in the country have tumbled, with Nissan’s alliance partner Mitsubishi Motors recently forced to suspend production. In June, according to the China Passenger Car Association (CPCA). Japanese brands’ share of China’s auto market fell to 17.8 per cent, down from 21.5 per cent in the same month last year.