Japanese automaker Nissan has announced a major downsizing plan as part of its Nissan global restructuring initiative, which includes cutting 11,000 additional jobs and closing seven factories worldwide, as the company grapples with falling sales and mounting financial losses. This latest round of layoffs raises the total number of job reductions announced over the past year to around 20,000 positions, or 15% of Nissan’s global workforce.
The company has been particularly hard-hit in its two largest markets, China and the United States, where it faces stiff competition and has resorted to steep discounts to maintain market share. The precise locations of the new layoffs have not been disclosed, and it remains unclear if the company’s major UK facility in Sunderland, which employs around 6,000 people, will be affected.
CEO Ivan Espinosa, who took over leadership earlier this year, stated that two-thirds of the layoffs will impact manufacturing jobs, while the rest will involve cuts in sales, administrative roles, research, and contract-based positions. This move follows a similar announcement in November, when 9,000 job cuts were revealed as part of a broader cost-saving effort that aimed to reduce global production by 20%.
Failed Merger and Mounting Financial Losses
The Nissan global restructuring comes in the wake of a collapsed merger plan with rivals Honda and Mitsubishi, which had aimed to create a $60 billion automotive giant capable of competing with industry leaders like Toyota and Volkswagen. The deal fell through in February after the three firms failed to reach an agreement on key aspects of the proposed alliance.
The fallout from the failed merger also led to a leadership shakeup at Nissan, with Makoto Uchida replaced by Ivan Espinosa, formerly the company’s chief planning officer and head of its motorsports division. Espinosa now faces the challenge of stabilizing the carmaker amid intensifying market pressures.
Nissan also reported a staggering annual loss of 670 billion yen (approximately $4.5 billion), citing rising operational costs and trade tensions, particularly tariffs imposed by the United States during the Trump administration. Espinosa acknowledged the difficulties of the past year, calling the financial results a “wake-up call” for the company.
Strategic Pullbacks and Industry Pressures
Alongside job cuts, Nissan has scrapped plans to build a battery and electric vehicle plant in Japan, further indicating a scale-back in future investments. The company offered no earnings forecast for the coming year, citing uncertainty over U.S. trade policy and global economic instability.
In China, Nissan has struggled to maintain its position as domestic brands like BYD dominate the growing electric vehicle sector. Many international manufacturers have failed to keep pace with the rapid shift toward EVs, leaving companies like Nissan at a disadvantage.
In the U.S., a combination of inflation and high interest rates has dampened consumer demand for new vehicles, further eroding sales. With competitive pressure rising and market conditions volatile, Nissan’s aggressive cost-cutting measures may only be the beginning of a deeper transformation, as part of the broader Nissan global restructuring aimed at survival in a rapidly evolving industry.
