Japanese carmaker Nissan cuts 9,000 jobs, reduces sales forecast for this fiscal | Mint
Japanese carmaker Nissan announced that the company will lay off 9,000 employees, and reduce its sales forecast for the financial year 2024-25, citing it to be a part of the urgent measures taken to tackle “a severe situation,” reported the news agency AFP on Thursday, November 7.
“Nissan will cut global production capacity by 20 per cent and reduce its global workforce by 9,000,” said the automaker reported the agency.
The company’s net profits plunged 93 per cent in the first half of the year, according to Nissan’s Chief Executive Officer Makoto Uchida citing weak sales in the North American market.
Nissan now expects net sales of 12.7 trillion yen ($80 billion), down from 14 trillion previously forecast, as per the report.
“Facing a severe situation, Nissan is taking urgent measures to turnaround its performance and create a leaner, more resilient business capable of swiftly adapting to changes in the market,” said Nissan in an official statement as per the report.
Uchida will voluntarily forfeit 50 per cent of his monthly compensation starting November 2024 and the other executive committee members will voluntarily take a pay cut, as per the statement.
Nissan and its Japanese rivals are also struggling to stand their ground in China, as fast-growing electric vehicle firms backed by Beijing race ahead.
“Net income is to be determined due to ongoing assessment of costs necessary for the planned turnaround efforts,” said Uchida as the company did not issue a net profit forecast on Thursday.
North America Market
Nissan’s main vehicle models are not performing as well as before in North America, “From the cost perspective, and the brand-strength perspective, we will rebuild our brand in America,” Uchida said as per the report.
Along with other measures Nissan will reduce its stake in Mitsubishi Motors by selling shares back to the firm. The stake in Mitsubishi will fall to nearly 24 per cent from 34 per cent.
Nissan has witnessed a rough decade, including the shock 2018 arrest of former boss Carlos Ghosn, who later jumped bail and fled Japan concealed in a music equipment box.
Ghosn remains an international fugitive in Lebanon and denies the allegations against him. He said he fled Japan because he did not believe he could receive a fair trial.
When asked about Donald Trump’s victory in the US presidential election, Uchida said Nissan was “hearing various things, like tariffs, but it’s not just us,” as per the agency report.
“We will be lobbying, and the direction of our medium- to long-term plans should remain, but we will conduct our business while monitoring the situation carefully,” he told the agency.
