November 11, 2024 – Nissan Motors Unveils Major Restructuring Plan Amidst Financial Struggles
Nissan Motors announced a significant restructuring plan on Thursday, aiming to navigate through a period of declining sales by cutting 9,000 jobs globally and reducing its production capacity by 20%. This move comes after the company reported a stark turn from profit to loss in its second-quarter financial results, with a net loss of 9.3 billion yen, contrasting sharply with the 190.7 billion yen net profit recorded in the same period last year.
In light of these dire financial circumstances, Nissan has revised its operating profit forecast for the fiscal year 2024 downwards to 150 billion yen, a far cry from the previously anticipated 500 billion yen. To address these challenges, the automaker outlined a series of measures to streamline costs and optimize its asset structure.
As part of its asset optimization strategy, Nissan plans to sell up to 10% of its stake in Mitsubishi Motors, currently holding a 34% share. Additionally, the company aims to reduce fixed costs by a substantial 300 billion yen through cuts in selling, general, and administrative expenses, as well as product costs.
While Nissan has not disclosed specific details about the timing and locations of the job cuts, regulatory filings indicate that the company employed approximately 134,000 full-time workers worldwide at the end of March. This restructuring plan is poised to have a profound impact on its workforce. In a show of solidarity with the company’s efforts to weather the storm, CEO Makoto Uchida announced that he will voluntarily halve his monthly salary starting from November 2024, with other executive committee members also taking salary reductions.
In a public statement, Uchida acknowledged the immense challenges ahead in achieving their sales targets and emphasized the need to rebuild strength to steer the company towards a more positive trajectory. “While these efforts to turn the tide may seem like a scaling down, I am firmly committed to restoring Nissan Motors to a path of growth,” he stated.
The implementation of this restructuring plan marks the beginning of a challenging transformation journey for Nissan Motors, but it also lays the groundwork for the company’s sustainable growth in the future.