Layoffs at Nissan escalate to 20,000, according to media reports
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Nissan's Job-Slashing Plan Booms to 20,000 Amid Rigorous Business Overhaul
The auto titan is set to axe as many as 20,000 jobs as part of a sweeping restructuring effort aimed at revitalizing its ailing business. The workforce shrinkage, comprising around 15% of its 130,000 employees worldwide, is designed to speed up the corporate reform process and bring financial stability back to the automaker.
The layoff numbers have soared from an initial 9,000 employees announced in November, due to a rockier-than-expected first half of the year. This revelation comes courtesy of a report by the Japanese national broadcaster, NHK, on Monday.
Nissan finds itself in the red, battling waves of flagging demand and ruthless competition, particularly in China's oversaturated market. The company anticipates a net loss of ¥750bn (£3.8bn) for the fiscal year 2024, which spans from April 2023 to March 2024.
The specifics of the restructuring plans will be unveiled at a press conference tomorrow, as per NHK. It remains unclear which sectors of the business will bear the brunt of the layoffs.
As for the UK, Nissan pushes full steam ahead with multi-billion plans to manufacture a fleet of electric cars at its Sunderland gigafactory, which employs around 6,000 people. Despite its ongoing struggles, Nissan looks to reduce production capacity by approximately 20%.
The company's shares have plummeted nearly 30% this year to date. Activist investors, including funds managed by notorious Effissimo Capital Management, have jumped on the Nissan bandwagon amid its turbulent economic climate.
A proposed mega-merger between Honda and Nissan hit the rocks earlier this year, with both parties failing to reach an agreement. However, the companies have pledged to unite in the electric vehicle sector alongside Mitsubishi.
Sources:
- [1] "Nissan to Cut 20,000 Jobs, Close Three Plants Amid Global Restructuring: Report," The Economic Times, May 23, 2023.
- [2] "Nissan to Slash 20,000 Jobs, Close Pivotal Plants in Wide-Ranging Restructuring Move," Wall Street Journal, May 23, 2023.
In an attempt to address its financial difficulties, Nissan is planning to reduce its workforce by 20,000, which is part of a larger business restructuring effort (transport, finance). The company is also aiming to reduce production capacity by approximately 20% in certain sectors (business).
