Nissan to reduce workforce by 15 percent, close 7 plants in Japan, overseas

*Japan’s third-biggest automaker Nissan unveils new sweeping cost-cutting measures towards reducing its workforce by around 15 percent, and reduce production plants to 10 from 17 in Japan, and globally

Isola Moses | ConsumerConnect

Citing global economic blues as part of a comprehensive cost-cutting plan, Japanese automaker Nissan Motor has said it is planning to shut two car assembly plants in Japan and overseas factories, including in Mexico.

Sources at the weekend told Reuters that the global automaker is considering closure of Japan’s Oppama plant, where it started production in 1961.

It was also gathered the company also plans to shut the Shonan plant operated by Nissan Shatai, in which Nissan is a 50 percent stakeholder, which would leave it with just three vehicle assembly plants in Japan.

Overseas, Nissan is considering ending production at plants in South Africa, India and Argentina, and cutting the number of factories in Mexico, one of the sources said.

Japan’s third-biggest automaker unveiled sweeping new cost cuts Tuesday reportedly hinted that it would reduce its workforce by about 15 percent and cut production plants to 10 from 17 globally, as it seeks to push through a turnaround.

The Yomiuri newspaper, which first reported the automakers’ possible closing of plants in Japan and overseas, as well noted the two factories in Mexico are under consideration.

Nissan, nonetheless, in a statement on its Web site saud certain reports on the potential closure of certain plants were “speculative”, and not based on any official information of the company.

The company stated: “At this time, we will not be providing further comments on this matter.

“We are committed to maintaining transparency with our stakeholders and will communicate any relevant updates as necessary.”

The more aggressive turnaround steps unveiled by new Chief Executive Officer (CEO) Ivan Espinosa mark a sharp break with Nissan’s strategy under his predecessor, Makoto Uchida.

Uchida had high hopes of expanding global production and had refused to close domestic plants, according to report.

The automaker’s fiscal 2024 sales stood at 3.3 million vehicles, down 42 percent since the 2017 business year.

Nissan, in the statement Saturday, May 17 said it had previously announced it would consolidate production of Nissan Frontier and Navara pickups from Mexico and Argentina into a single production hub centralised around the Civac plant in Mexico.

It also said that it had announced in March that French alliance partner Renault would buy out its stake in their joint Indian business, Renault Nissan Automotive India Private Ltd (RNAIPL).

The domestic plant closures would mark Nissan’s first since closing its Murayama factory in 2001, report said.

Keeping just three home plants open – it’s Tochigi factory and the Nissan Motor Kyushu and Nissan Shatai Kyushu plants in southern Fukuoka prefecture – would be more than enough to service the domestic market and maintain exports from Japan, a source said.

The Oppama plant has an annual capacity of around 240,000 cars and employs about 3,900 workers as of end of October.

In 2010, it became Nissan’s first plant to start producing the Leaf, widely considered the world’s first mass-market electric vehicle.

Kindly Share This Story