Nissan Motor says it will trim 9,000 jobs and cut output capacity after net profit tumbled 94 percent on sluggish sales and higher costs in North America.
Net income slumped to 19.2 billion yen, or about 125 million dollars, in the April-to-September period. Sales dropped 1.3 percent from a year earlier to 5.9 trillion yen, or about 39 billion dollars.
Production costs also rose in North America, while a shift to electric vehicles in China undermined demand there.
In response to the downturns, Nissan says it will reduce global production capacity by 20 percent and complete the planned workforce reductions by March 2027.
The carmaker also says it is reducing its 34 percent holding in Mitsubishi Motors shares. The affiliated auto producer says in a statement that it bought a stake of up to 10 percent back from Nissan at the market price Thursday.
President and CEO, Nissan Motor Uchida Makoto said at a news conference that the steps are intended to help the company recover.
He said: “We’d like to build a slim and resilient business structure again so that we can flexibly respond to any changes in the environment in the future.
And for future growth, we hope to improve our product strength, which is the core of our business, and to put Nissan back on a growth track.”
The firm also says he will forfeit 50 percent of his pay, starting this month.
Nissan reduced its sales forecast for the current fiscal year and said it couldn’t yet provide an outlook for profit.
It says it will proceed with structural reforms and review its management system by April.
Uchida said he would closely watch the situation regarding the carmaker’s North American production base in Mexico. US President-elect Donald Trump has pledged to impose 100 percent tariffs on automobiles produced in Mexico and imported to the US.
