Nissan has announced a sweeping restructuring plan, with 9,000 global job cuts aimed at addressing significant financial losses and reducing production costs. The Japanese automaker will also reduce its production capacity by 20%, as reported by ITV Tyne Tees. This move follows a sharp reduction in the company’s profit outlook, slashed by 70% to 150 billion yen (around £754 million) for the current fiscal year.
A Response to Declining Profits and Global Competition
The job reductions will impact nearly 7% of Nissan’s global workforce, which numbers around 133,000, and comes amid a backdrop of falling profits. According to The Financial Times, operating profit fell by 85% in the last quarter, driven by a 3.8% drop in global sales and growing competitive pressure, particularly from Chinese electric vehicle (EV) makers. Nissan CEO Makoto Uchida stated that these changes are aimed at streamlining the company, describing the measures as essential for Nissan’s long-term competitiveness.
Uchida also announced that he would voluntarily reduce his salary by 50%, a gesture he described as part of Nissan’s renewed commitment to resilience and recovery.
Impact on UK Operations Still Unclear, Nissan Sunderland Plant Likely Secure
Nissan has yet to detail how these changes might impact its Sunderland plant, where around 6,000 employees produce core models such as the Qashqai, Juke, and the electric Leaf. According to ITV Tyne Tees, a representative from the Unite union suggested that UK jobs are currently expected to remain unaffected. In a post on social media, the North East Mayor also reassured residents about the plant’s future, referencing recent investments to support electric vehicle production in Sunderland.
Strategic Adjustments and Alliances
In addition to the job cuts, Nissan plans to sell down its stake in Mitsubishi Motors from 34% to 24%, aiming to raise funds to support its turnaround efforts. This change aligns with a broader strategy to focus on high-demand EV and hybrid vehicles, with plans to release new models jointly developed with Honda. Nissan has also committed to refining its approach in the EV market, particularly to meet competition in key international markets, as reported by The Financial Times.
The restructuring is part of Nissan’s broader initiative to establish a leaner, more flexible operation capable of adapting to market shifts while restoring profitability.
