Nissan Motor Co. has announced plans to cut approximately 20,000 jobs worldwide, doubling its initial layoff projections. This move represents about 15% of the company’s global workforce and is part of a broader restructuring strategy aimed at addressing significant financial challenges.
Reasons Behind the Job Cuts
The decision to increase job cuts stems from several factors:
- Financial Losses: Nissan is anticipating a record net loss of 700 to 750 billion yen ($4.74 to $5.08 billion) for the fiscal year ending March, largely due to impairment charges.
- Market Challenges: The company has faced declining sales in key markets, particularly in the United States and China. In China, Nissan’s market share has halved over the past four years, and in the U.S., the company struggles with an outdated vehicle lineup and a lack of hybrid models.
- Operational Restructuring: Nissan plans to suspend operations at some domestic factories in Japan as part of its restructuring efforts.
Impact on Global Workforce
The job cuts will affect various regions:
- Sunderland Plant, UK: Approximately 6,000 positions are at risk at Nissan’s Sunderland plant, which has produced over 11 million cars since its opening in 1986.
- U.S. Operations: Nissan is reducing production at its U.S. plants and offering buyouts to factory workers as part of its plan to cut 9,000 jobs globally.
Leadership Changes and Future Outlook
In March, former CEO Makoto Uchida stepped down following stalled merger negotiations with Honda. Ivan Espinosa has since taken over as CEO and faces the challenge of stabilizing the company. Nissan’s near-term strategy includes launching several new models aimed at reversing declining sales figures. Reuters
