Nissan will cut 9,000 jobs and cut global production by 20% due to falling revenues – sales decline in China and the US

Things aren’t going well for Nissan, with Japan’s third-largest automaker announcing it intends to cut 9,000 jobs – or about 6.7% of its 133,580 workforce worldwide – as it grapples with slumping sales and related losses. .

The company reported a loss of nine billion yen (RM259 million) in the third quarter, a sharp contrast to the 191 billion yen (RM5.49 billion) profit it recorded in the same period last year. The worsening situation led the carmaker to cut its full-year profit forecast by 70% to 150 billion yen (RM4.3 billion), the second time this year it has revised the figures.

It added that it would reduce its global production capacity by 20%. The company has 25 vehicle production lines worldwide and plans to reduce their maximum capacity, said Monozukuri (production) chief director Hideyuki Sakamoto. One method is to change line speeds and shift schedules in factories, he explained.

The carmaker also intends to cut its sales budgets and sell up to 10% of its stake in Mitsubishi Motors to raise up to 68.6 billion yen (RM1.98 billion). Reuters reported. However, the brand added that it will deepen its collaboration with Mitsubishi as well as Renault as it aims to reduce vehicle development time to 30 months.

Like many foreign automakers, Nissan is struggling in China as local brands have gained significant market share thanks to the plethora of electric and hybrid vehicles available. Its global sales fell 3.8% to 1.59 million vehicles in the first half of the fiscal year, mainly due to a 14.3% drop in China.

Meanwhile in the US it suffers from a lack of the right models. Sales in that market fell nearly 3% to about 449,000 vehicles. According to CEO Makoto Uchida, the company misjudged the demand for hybrids in the United States.

“We did not expect the number of HEVs to grow so quickly. We started to realize this trend towards the end of the last financial year,” he said, adding that some changes to core models also did not go as smoothly as planned.

Uchida said he would voluntarily cut his monthly salary by 50% starting this month, and added that other members of the executive committee would also voluntarily take pay cuts. However, he declined to provide details about the timing and location of job and production cuts.

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