The Japanese car manufacturer Nissan announced Thursday that it would cut 9,000 jobs from its global workforce, while reducing its production capacities across the globe by 20%, without specifying a timetable, to adapt to a clear deterioration in its sales.
The company plunged into the red from July to September, according to results that were much worse than expected published on Thursday, and revised its forecasts for the entire current financial year downwards.
“Faced with the seriousness of the situation, Nissan is taking urgent measures to turn around its performance and create a more responsive and resilient company, capable of quickly adapting to market developments,” notes the group in a press release.
Nissan suffered an unexpected net loss of 9.3 billion yen (56 million euros) in the second quarter (July-September) of its staggered financial year, contrary to the net profit of 49 billion yen expected by the market, according to the consensus established by Bloomberg.
Its quarterly turnover fell to 2,986 billion yen (18 billion euros), down 5% over one year, according to its results published Thursday, again clearly below expectations, while profit operating income was half as large as that expected by analysts.
Like all of its Japanese and Western rivals, Nissan is suffering from the slowdown in global sales of new cars and a gloomy economic situation.
Its sales particularly suffered in the United States, a crucial market for the group, where it sold only 212,000 units over the July-September period, down 2.3% year-on-year.
Another key market in difficulty: China, where its sales collapsed over the same period by 13% over one year, to 172,000 units. They also fell by 5.9% in Europe, to 80,000 vehicles sold.
As a result, Nissan has significantly revised its expectations for its entire 2024-2025 staggered financial year which will end at the end of next March.
The group now forecasts annual revenue of 12.7 trillion yen, up from 14 trillion yen previously, almost unchanged from 2023-2024. It expects an operating profit of 150 billion yen, three times less than what it had previously anticipated.
No annual forecast is anymore provided for net profit: “this will be determined according to the ongoing assessment of the costs generated by the recovery efforts,” warned the executive director, Makoto Uchida, during a conference.
“Nissan aims to reduce its fixed costs by 300 billion yen compared to the 2024-2025 financial year and its variable costs by 100 billion yen while maintaining healthy free cash flow,” the group specifies in its press release.
“To achieve this, Nissan will reduce its global production capacity by 20% and its global workforce by 9,000 people, while implementing various measures to reduce selling, general and administrative expenses, product costs, rationalize its portfolio of “assets and prioritize capital expenditure and investments in research”, he explains.
