Nissan is set to reduce its workforce by approximately 9,000 jobs globally as part of a strategic initiative to address falling sales in key markets such as China and the United States. This decision marks a significant shift for the Japanese automaker, which will also slash its global production by 20%. The company has yet to specify the regions or facilities that will be affected by these layoffs, leaving many employees uncertain about their future.
As part of this cost-saving strategy, Nissan has revised its operating profit forecast for 2024, projecting a 70% decrease. This revision represents the second downward adjustment made by the company within the year, reflecting ongoing challenges in the automotive market.
Nissan’s CEO, Makoto Uchida, emphasized that these measures do not signify a reduction in the company’s overall size. Instead, he described them as essential steps to create a more agile and resilient organization.
In an effort to further tighten financial belts, Uchida announced a personal salary reduction of 50%, alongside pay cuts for other senior executives. Following this news, Nissan’s stock experienced a decline of more than 6% in trading on Friday morning in Tokyo.
Nissan faces intense competition in China, where local manufacturers like BYD are rapidly gaining ground and driving prices down. As a result, many foreign automakers are struggling to maintain their market share. Mark Rainford, an industry expert based in China, pointed out that Nissan’s delayed entry into the electric vehicle segment has adversely affected its competitive standing.
In addition to challenges in China, Nissan is grappling with sluggish sales in the U.S., where inflation and rising interest rates have dampened consumer demand for new vehicles. These market pressures have prompted many manufacturers to lower prices—a move that has further squeezed profit margins.
Despite these challenges, Nissan remains committed to its future plans. In November of last year, the company announced a £2 billion ($2.6 billion) investment aimed at developing three electric vehicle models at its Sunderland factory. The initiative includes production of electric versions of popular models like the Qashqai and Juke, along with an updated iteration of the Leaf.
As Nissan navigates this tumultuous landscape, it faces critical decisions about its operational structure and product offerings. The company’s ability to adapt quickly to changing consumer preferences and technological advancements will be vital for its resurgence in both domestic and international markets. The coming years will determine whether these restructuring efforts can successfully reposition Nissan as a competitive player in an evolving automotive industry.
Nissan announces significant cuts in staff and production Nissan, one of Japan’s leading automakers, has revealed a restructuring plan that includes cutting 9,000 jobs globally and cutting production capacity by 20%.
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