Nissan is set to cut production capacity by 20%. Picture: Supplied
Nissan is set to cut its global production capacity by 20% and reduce its workforce by 9,000 staff members in a bid to mitigate its current downturn in sales and profits.
“Facing a severe situation, Nissan is taking urgent measures to turnaround its performance and create a leaner, more resilient business capable of swiftly adapting to changes in the market,” Nissan said in a statement.
Nissan announced on Thursday that its consolidated operating profit decreased by 303.8 billion yen (R34.9bn) to 32.9bn yen (R3.7bn) in the first half of 2024.
Through this turnaround plan, Nissan aims to reduce its fixed costs by 300 billion yen (R33.9 billion). It will also deepen its strategic partnerships with its Alliance partners Renault and Mitsubishi as well as Honda, with which it has a Memorandum of Understanding (MOU) to further explore vehicle electrification synergies.
In a bid to lead by example, Nissan CEO Makoto Uchida and other senior executives have agreed to take a 50% pay cut.
On the product front, Nissan said it would accelerate the introduction of electric vehicles in China, as well as plug-in hybrids and e-Power hybrids in the US. The company also wants to reduce its product development lead time to 30 months.
The Japanese carmaker’s turnaround actions will be monitored by a new Chief Performance Officer, who will be appointed from December 1.
It’s unclear how this turnaround plan will affect Nissan’s South Africa’s Rosslyn manufacturing plant in Gauteng.
Nissan SA already cut its workforce by around 25% earlier in 2024 after it was forced to discontinue the popular NP200 compact bakkie due to its global model cycle ending and the lack of a suitable replacement model.
The plant currently produces around 1,000 Navara bakkies per month, of which just over half are exported to a growing number of export markets on the African continent.
Nissan SA has previously expressed interest in securing a second product for the plant.
IOL
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