Nissan to shut plants, ax 20,000 jobs after logging FY 2024 net loss

Japan's third-biggest automaker by volume, which has been grappling with poor sales in the United States and China, will now see its total workforce reduced by around 15 percent. To address overcapacity issues, its vehicle plants will be reduced from 17 to 10, including some in Japan, by fiscal 2027.

Nissan plans to shrink global output capacity excluding China by 30 percent to 2.5 million units also by that target year, expecting cost-saving measures to help return it to profitability by fiscal 2026.

The impact of U.S. President Donald Trump administration's tariff policy, including the imposition of 25 percent levies on autos from April, however, overshadows the outlook for Nissan. Vehicles accounting for less than 45 percent of the total U.S. sales are imported from Japan and Mexico.

Nissan did not provide guidance for net income and operating profit for the current year ending March 2026, citing uncertainty related to the U.S. tariff policy.

"The decision (to reduce workforce), of course, was not easy," CEO Ivan Espinosa, who assumed Nissan's top post on April 1, said. "It's a very, very painful and sad decision to take...we wouldn't be doing this if it was not really, really necessary to do it."

"Unfortunately, as you have seen the results, the size of the company is just not sustainable, and if we don't do something now, the problem will just get worse," he said.

Espinosa said he hopes to see "stability and clarity" in the U.S. tariff policy, as Japan negotiates with the United States to win a full removal of higher tariffs implemented by Trump, including on autos.

"It's very difficult to plan in the current volatility," he said.

The latest slashing of the workforce includes the cutting of 9,000 jobs globally, announced in November.

The net loss in the reporting year came below the estimate, released in April, of 700 billion yen to 750 billion yen of red ink, which would have been the company's largest-ever loss. The figure is in stark contrast with the net profit of 426.65 billion yen the previous fiscal year.

For the just-ended business year, Nissan's operating profit plunged 87.7 percent to 69.80 billion yen and sales edged down 0.4 percent to 12.63 trillion yen.

In fiscal 2024, global sales totaled 3.35 million units, down 2.8 percent from the year before.

In December, Nissan said it was seeking to establish a holding company in 2026 with rival Honda Motor Co. that would have created the world's third-largest auto group. But negotiations broke down just two months later after Honda's proposal to make Nissan its subsidiary riled the Yokohama-based automaker's board.

Espinosa said the company will continue to "actively" seek collaboration with Honda, particularly in the areas of electrification and digitalization, and other partners including in the United States.