Nissan will cut its workforce by 20,000 and close seven factories by 2027, in its new CEO’s bid to ensure profitability.
The company hopes to save a total of JP¥500 billion through CEO Ivan Espinosa’s cost-cutting plan, known as Re:Nissan, following a decline in income in recent years.
“In the face of challenging FY24 performance and rising variable costs, compounded by an uncertain environment, we must prioritize self-improvement with greater urgency and speed, aiming for profitability that relies less on volume,” said Espinosa.
“Re:Nissan is an action-based recovery plan clearly outlines what we need to do now. All employees are committed to working together as a team to implement this plan, with the goal of returning to profitability by fiscal year 2026.”
Nissan will “consolidate” several of its factories, the company said, reducing its production plants from 17 to 10 by fiscal year 2027. It will pause or cancel several product initiatives, including a planned battery plant in Kyushu.
The company will also lay off 20,000 employees between fiscal years 2024 and 2027, including 9,000 it announced last year. “This workforce reduction globally covers direct/indirect roles and contractual roles in manufacturing, SG&A and R&D functions,” Nissan said.
Nissan also reported its earnings for fiscal year 2024 this week. Revenue was JP¥12.69 trillion, dropping ¥52.5 billion year-over-year. Nissan posted a net loss of ¥670.9 billion, compared with a net income of ¥426.6 billion in fiscal year 2023.
It declined to issue full guidance for the 2025 fiscal year due to uncertainty over the United States’ tariff plans, but projected that revenue would continue to decline to JP¥12.5 trillion.
Nissan had previously sought a merger with Honda, but the companies ended their negotiations in February. Nissan had reportedly asked for an equal partnership, while Honda aimed at acquiring Nissan as a subsidiary. CEO Makoto Uchida then left the company, with Espinosa taking over in April.
Azzet has contacted Nissan Australia for comment.
Related content
