Nissan Layoffs 2019: 10,000 Job Cuts Worldwide To Be Announced Thursday, Sources Say – By Kalyan Kumar (IB Times) / July 24 2019
Japanese automaker Nissan will cut more than 10,000 jobs globally in a bid to turn around its business. This figure is almost double the target it announced in May when it said nearly 4800 jobs would be slashed worldwide.
According to reports, the new plan on drastic jobs cut will be announced Thursday when Nissan will release its earnings report for the three months spanning April to June 2019.
As of March 2019, Nissan and group companies had 139,000 employees per financial report.
A report by Kyodo News said the additional job reductions will also include pre-mature retirement options for workers.
The Japanese automaker is known for its high demand vehicles including Nissan Micra, Nissan Terrano and electric car Nissan Leaf.
The problem of falling sales and shrinking profit
In fiscal 2018, Nissan’s vehicle sales worldwide fell 4.4 percent to 5.52 million units.
Prominent markets that jolted Nissan included the United States where a 9.3 percent decline was visible and Europe had a 14.9 percent drop in sales.
The job cuts will be targeting overseas plants where low profitability is an issue while output will be streamlined in Japan. Many factories in South America and other regions will face job cuts.
Some informal reports also said Nissan is looking to stop production of NV200 van in Barcelona in the next two years. It was reported by the Nikkan Kogyo newspaper without citing any attribution.
Nissan is currently in the process of reviewing the expansionist business strategy pursued by Carlos Ghosn who was ousted for alleged financial misdeeds and is in jail now.
Ghosn was the architect of a three-way alliance involving Nissan-Renault and Mitsubishi Motors that emerged as the world’s second-largest auto group in 2018 in terms of vehicle sales.
A Nissan spokesperson told CNBC that the company will not comment on speculations.
Nissan under pressure
According to auto news reports, Nissan is under pressure and reported a 44.6 percent decline in operating profit for the 12 months ended on March 31, 2019. That was whopping a nine-year low in Nissan’s group net profits.
For the current fiscal year, Nissan’s guidance is that profits may drop by 28 percent.
Pictured: Nissan GT-R (R35) high performance sports car front view on display at Brussels Expo on January 13, 2017 in Brussels, Belgium. Photo: Getty Images/Sjoerd van der Wal
Nissan had a leadership overhaul after Ghosn’s arrest and exit. After that its alliance with French automaker Renault also came under pressure.
Renault holds a 43 percent stake in Nissan, and the Japanese automaker has a 15 percent non-voting stake in the French partner.
Nissan CEO Hiroto Saikawa recently said he prefers parity in the partnership with Renault. But Renault is reportedly seeking more control over Nissan.
The Nissan stock was up 0.85 percent on Wednesday’s trade in Tokyo.
