Nissan plans to cut at least 5,200 additional jobs globally to improve its performance, more than doubling the number flagged earlier this year, according to multiple reports.
The cuts are expected to be made mainly in factories outside of Japan, the UK’s Guardian newspaper reported, raising fears of job cuts at the automaker’s plant in Sunderland, England, which employs 7,000 people.
Nissan workers in Sunderland are already facing uncertainty due to Brexit and Nissan’s decision earlier this year not to build the X-Trail SUV in Britain.
The cuts come on top of Nissan’s plan unveiled in May to shed 4,800 jobs, revamp car models and boost poor sales in the U.S.
The job losses will mostly be at factories overseas with low utilization rates, Reuters reported, citing a source. The cuts will be announced along with financial results on Thursday, said the source, who declined to be identified as the information was still private.
Analysts expect Nissan to post one of its weakest quarterly performances since the 2008 global financial crisis on Thursday. Operating profit will decline 66 per cent to 37.2 billion yen ($344 million) in the first fiscal quarter through June, according to the average of analysts’ projections compiled by Bloomberg. Sales will decline 3 per cent to 2.63 trillion yen, analysts predict. A representative for Nissan in Japan declined to comment.
Nissan is under pressure to revive its business following car-inspection scandals as well as last year’s arrest and the ouster of former Chairman Carlos Ghosn, bringing deep tensions with alliance partner Renault to the surface.
The automaker’s operating profit fell to the lowest in a decade in 2018.
“Once chasing nothing but volume under Ghosn, Nissan is now scrapping that strategy and is shifting its focus more on profitability,” said Koji Endo, an analyst at SBI Securities. “In order to achieve this, they are reducing the size of the company.” This includes cutting back its “inflated capacity and number of employees, as well as a bunch of unprofitable cars and trucks,” he said.
Separately, Nissan is preparing to end production of its NV200 van in Barcelona within the next two years, the Nikkan Kogyo newspaper reported, without naming sources.
