Japanese carmaker Nissan has announced plans to cut 11,000 more jobs worldwide and shut down seven factories as part of a major business overhaul due to weak sales.
With this move, the total number of jobs Nissan plans to cut, rises to about 20,000 — which accounts for 15% of its global workforce, according to Reuters and The Associated Press. The company will also reduce its number of production plants from 17 to 10.
Nissan has been struggling with falling sales in China and heavy discounting in the US, its two largest markets, which has hurt its earnings. A planned merger with Honda and Mitsubishi also fell through in February.
It is still unclear where the job cuts will take place or if Nissan’s plant in Sunderland will be affected.
‘Full-year financial results a wake-up call’: Nissan CEO
Newly appointed CEO Ivan Espinosa acknowledged during a press conference that the company’s financial results for the year serve as a clear warning. the USA Today reported. He highlighted that rising variable costs and fixed costs exceeding the company’s current revenue were significant challenges.
This decision follows a series of challenges for Nissan, including a leadership change, declining sales, and possible merger talks. However, experts believe the company isn’t in danger of failing soon, according to the Detroit Free Press, part of the USA TODAY Network, last month.
In December 2024, Nissan and Honda announced plans to merge, but Nissan backed out of the talks in February.