Nissan may cut 10,000 jobs worldwide

Nissan plans to cut more than 10,000 jobs around the world as it struggles to revive its troubled business and salvage its reputation after the ousting of chairman Carlos Ghosn.

Nissan is expected to announce the cuts officially on July 25 when the company reports what is expected to be its worst quarterly results in more than a decade, reported the UK Guardian newspaper.
The manufacturer, which in May announced it would cut 4,800 jobs from its global workforce of about 139,000, has about 8,000 employees in the UK.

The cuts are expected to fall mainly in factories outside Japan and will increase fears of job losses at Nissan’s operation in Sunderland, the UK’s largest car plant.

Workers are already facing uncertainty after Nissan in March cancelled the production of two luxury Infiniti models, part of its plans to pull out of the premium car market in western Europe.

That decision followed Nissan’s shock announcement to build its new X-Trail in Japan. The company had previously chosen Sunderland for the X-Trail after initially receiving pledges of more than £80m ($100m) in government help. This offer was later reduced to £61m.

Japanese media reported that the job cuts were likely to hit factories in South America and other regions where Nissan has low profitability.

Nissan has also struggled to improve poor profit margins in the US, the world’s second-biggest automotive market, where years of heavy discounting to try to drive sales has hurt its brand image and bottom line.

The company is expected to report a year-on-year drop in operating profits of as much as 90%, according to reports, which would be one of Nissan’s weakest performances since the 2008 global financial crisis.

A spokesman for Nissan said the company did not comment on speculation. The cuts were first reported by the Japanese news agency Kyodo.

Nissan has been hit by a fall in sales in the US and Europe and is still reeling after the arrest of former boss Ghosn on financial misconduct charges.

It has also been facing tensions with its French partner, Renault, which owns 43% of the Japanese manufacturer, and is undergoing an overhaul intended to strengthen governance after the Ghosn scandal.

In May, Hiroto Saikawa, Nissan’s chief executive, announced a strategic shift away from Ghosn’s expansionist policy, unveiling a plan to cut 4,800 jobs and reduce global capacity by 10%.

Nissan reported net profits of 319bn yen ($2.9bn) for the year to the end of March, the lowest amount since 2009-10 when the company was struggling in the wake of the global financial crisis.

It was a decline of 57% compared with the previous fiscal year and the profit outlook for the current fiscal year was forecast to be even worse at 170bn yen.