Nissan slashes 9,000 jobs amid hybrid demand misjudgment
Nissan, the third-largest car manufacturer in Japan, announced on Thursday a reduction in employment, as well as a decrease in global production capacity. The CEO admitted that the company, which employs about 133,500 people worldwide, made a mistake and has resigned from part of his salary.
The Japanese corporation is in trouble for several reasons, one of which is the fact that it misjudged the growth in demand for hybrids in the United States. Unlike Toyota, which is doing better thanks to this than the company based in Yokohama. The financial situation of Nissan is not improved by the dominance of the Chinese BYD in the market in China.
On Thursday, 7 November, Makoto Uchida, the CEO of the Japanese corporation, admitted the mistake made in forecasting the growth in popularity of electric-gasoline vehicles.
— We did start to understand this trend towards the end of last fiscal year, — said the head of Nissan Motor, quoted by Reuters. And this will have painful consequences for some employees.
Nissan's CEO resigns part of his salary
Uchida announced the dismissal of 9,000 people, which is 6.7 percent of the 133,500 employees worldwide. He also "voluntarily" will face consequences. Starting this month, he will receive half of his salary. Other members of the executive committee, as reported by Reuters, also decided to reduce their salaries.
This is not the end. Nissan announced that it will reduce global production capacity by 20 percent. In return, the corporation intends to move forward and shorten the development time for new projects to 30 months.
The company is undergoing restructuring to lower costs by approximately £2 billion. Nissan also wants to sell up to 10 percent of its shares in Mitsubishi Motors to gain about £340 million.
Global sales of Nissan fell by 3.8 percent to 1.59 million vehicles in the first half of the fiscal year, mainly due to a 14.3 percent decline in China. Sales in the USA dropped by nearly 3 percent to about 449,000 vehicles. Together, both markets account for nearly half of Nissan's global sales — reports Reuters.
