Thu, Jul 25, 2019 - Page 10 News List

Nissan to double job cuts to over 10,000: source

Reuters, TOKYO

Nissan Motor Co plans to expand job cuts to more than 10,000 to help turn around its business, a person with direct knowledge of the matter said yesterday, as profit continues to plunge while the automaker grapples with management upheaval.

The global plan includes the 4,800 job cuts announced in May and would mostly be at factories overseas with low utilization rates, the person said.

It would be announced along with financial results today, said the person, who declined to be identified, as the information was still private.

Nissan declined to comment on the job cuts.

Analysts expect Nissan to post one of its weakest quarterly performances since the 2008 global financial crisis when it announces its first-quarter earnings.

The Nikkei business daily yesterday reported that the automaker would report operating profit of “several billion yen” for the quarter, about a 90 percent drop from ¥109.1 billion (US$1 billion) a year earlier.

Analysts estimate a decline of 64 percent.

The job cuts, exceeding 7 percent of Nissan’s 138,000-strong workforce, come as it struggles to improve dismal profit margins in the US, a key market where former chairman Carlos Ghosn for years pushed to aggressively grow market share during his time as chief executive.

The latest job cuts also highlight the extent of problems facing chief executive Hiroto Saikawa, who is also grappling with fractured relations with French alliance partner Renault SA following the arrest of their shared former chairman.

Ghosn has been charged with financial misconduct and denies wrongdoing.

In May, Nissan forecast a 28 percent plunge in annual operating profit, adding to a 45 percent fall in the previous year, putting the automaker on course for its weakest earnings in 11 years.

The extended job cuts were first reported by Kyodo news agency late on Tuesday.

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