Nissan is closing seven factories that have lost 20,000 jobs worldwide after a turbulent year for Japanese automakers.
If production is reduced, Nissan will cut jobs by 11,000 more after it was announced that it would unemployed in November, resulting in a collective 15% reduction in its workforce. This decision will affect the work of staff and contractors across manufacturing, sales, management, and research and development.
Nissan had not said which factories were scheduled for closing. However, the factory in Sunderland, northeastern England, is the only factory in Europe and employs 6,000 people, so it is not considered likely to be closure.
Shakeup aims to reduce the number of factories from 17 to 10 by 2027, saving a total of 500 million yen (£2.6 billion). Nissan will also overhaul its supply chain and source more parts from fewer suppliers to save money.
The company’s new CEO, Ivan Espinosa, faces the difficult task of turning a car manufacturer whose value of the brand they once fought on is eroding. He told the press conference.
“In the face of rising variable costs worsened by the full year performance of 2024 and the uncertainty environment, we aim to prioritize self-improvement and volume-dependent profitability,” he said.
“As a new executive, we are taking a sensible approach to reassessing our goals and actively seeking every possible opportunity to implement and secure a robust recovery.”
Nissan suffered a net loss of 607.1 billion yen per year by the end of March, as it was hit by weaker US and China sales as well as the early effects of Donald Trump’s trade war. Discussing the $600 billion merger with Honda, Espinosa took over as chief executive last month.
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The company said it aims to reduce the average cost of the workforce by 20% by “rationalizing global R&D facilities and assigning work to competitive locations.”
Nissan’s supplier AESC, which operates the UK’s only operational GigaFactory, has secured funding for Sunderland’s new electric vehicle battery plant in a government-supported deal that secures the future of key projects for the struggling UK auto industry.
