A MAJOR car brand has revealed it will halt operations for some new models in a bid to cut soaring costs.
The manufacturer also announced it will be cutting 11,000 roles worldwide – just months after the brand had already announced plans to cut around 9,000 jobs.
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Japanese car giant Nissan has said it will pause work on the development of a few cars.
The brand said that work has been suspended on “advanced and post-FY26 product activities”.
But the manufacturer did not reveal the names of the models that will be affected by the sudden change.
However, Nissan suggests that the rollout of these models might not be delayed.
In this new era of development at Nissan, the first models to launch will be a global compact crossover and a similarly sized model.
A new version of Nissan Skyline is also in the works that could end up becoming a sedan – or even an SUV.
It comes after Nissan confirmed it will shut almost half of its factories by 2027.
The announcement said: ” Nissan will consolidate its vehicle production plants from 17 to 10 by fiscal year 2027.”
It added: “Nissan aims to reduce its workforce by a total of 20,000 employees between fiscal years 2024 and 2027.”
The seven factories which will close are currently unknown, but the Nikkei business daily has reported today that some of these will be in Nissan’s home country, Japan.
The company has confirmed that it will cancel plans to build a Lithium Iron Phosphate battery plant in Kyushu.
Nissan also hasn’t said where the 20,000 job cuts will take place, but the company did specify departments which will likely be impacted.
As of March last year, the company had more than 133,000 staff worldwide – meaning a total of 15 per cent of its entire workforce is set to be hit.
However, there could be further structural changes to its remaining personnel, as Nissan wants to reduce its workforce’s average cost per hour by 20%.
The company said: “This workforce reduction globally covers direct/ indirect roles and contractual roles in manufacturing, SG&A (selling, general and administrative expenses) and R&D (research and development) functions.
“Additionally, Nissan will implement further measures under SG&A, including expanding the scope of shared services and identifying efficiencies in marketing.”
These new cost-cutting measures arrive under Nissan’s explosive “Re:Nissan” plan, announced this morning.
The plan aims to save an eyewatering 500 billion yen ($3.38bn) in just two years, by creating a “leaner, more resilient business”.
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The company is seeking to implement these after a disastrous two years for the company’s finances.
This morning, Japan’s third-largest carmaker announced a net loss of 671 billion yen over the last financial year.
Combined with considerable losses of 427 billion yen ($2.88bn) last year, Nissan has had a net loss of almost 1.1 trillion yen ($4.11bn) since March 2023.
The company is looking to produce an incredible turnaround and become profitable again by 2026.
Nissan president and CEO Ivan Espinosa said: “In the face of challenging FY24 performance and rising variable costs, compounded by an uncertain environment, we must prioritise self-improvement with greater urgency and speed, aiming for profitability that relies less on volume.
“As new management, we are taking a prudent approach to reassess our targets and actively seek every possible opportunity to implement and ensure a robust recovery.
“Re:Nissan is an action-based recovery plan that clearly outlines what we need to do now.
“All employees are committed to working together as a team to implement this plan, with the goal of returning to profitability by fiscal year 2026.”
