Nissan Cuts 15% of Global Workforce: What’s Behind the Sudden Layoffs?
Nissan is set to cut approximately 15% of its global workforce, equating to around 20,000 jobs, as the automaker grapples with significant losses of $4.5 billion in the fiscal year that ended in March. This drastic measure aims to combat declining vehicle sales, particularly in China, and the impact of rising restructuring costs. As part of its recovery strategy, Nissan plans to reduce the number of auto plants from 17 to 10, with closures confirmed in Japan, although specific locations remain undisclosed. CEO Ivan Espinosa emphasized a rigorous approach, stating, "Starting today, we build the future for Nissan."
The automaker, facing challenges from tariffs imposed during the Trump administration, will also halt plans to establish a battery plant in Japan. Nissan’s restructuring is aimed at saving $3.4 billion and aligning production with market demands. Espinosa noted collaborations with partners like Renault SA in Europe and Dongfeng Nissan in China will be critical for future adaptability.
Despite these measures, Nissan’s Chief Financial Officer, Jeremie Papin, has acknowledged the obstacles ahead, as no profit projections have been shared for the fiscal year through March 2026 due to market uncertainties. Nissan aims for profitability by fiscal year 2026, embarking on a path of strategic reassessment.
FAQ Section
1. Why is Nissan reducing its workforce?
Nissan is reducing its workforce by about 20,000 employees to address significant financial losses and declining vehicle sales internationally, particularly in China.
2. What is Nissan’s recovery plan?
Nissan’s recovery plan includes cutting auto plants from 17 to 10, closing facilities in Japan, reducing costs by $3.4 billion, and leveraging partnerships to adapt to market demands.
3. What financial challenges does Nissan face?
Nissan reported a loss of $4.5 billion for the fiscal year through March, impacted by tariffs and restructuring costs. The company also faces uncertainties in projecting future profits.
4. When does Nissan expect to return to profitability?
Nissan aims to achieve profitability by the fiscal year 2026, following strategic adjustments and a thorough operational review.
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