Nissan Is Cutting Workforce by 20,000 and Closing Factories

Nissan is cutting costs and reducing production. As part of a recovery strategy, the company plans to eliminate around 20,000 jobs and close seven factories.

At the end of the most recent fiscal year, the Japanese automaker reported some dismal financials. The company lost almost 671 billion yen, or about $4.5 billion, in 2024. Operating income fell 88% compared to 2023, falling to 69.8 billion yen ($472 million). By the time the current quarter ends, Nissan is estimating a 200 billion yen ($1.4 billion) operating loss.

“We have a mountain to climb,” said CEO Ivan Espinosa, per AP News. “Starting today, we build the future for Nissan.”

In November, Nissan initially announced 9,000 job cuts, but now it has reported that an additional 11,000 layoffs will occur. The layoffs should be completed by March 2028, with most coming from manufacturing. Other departments affected by job cuts will be sales, administration, research, and contractors.

Nissan Has Been Struggling

Nissan has been hit hard with weak sales in the U.S. and China, its two biggest markets. Tariffs as well as increased interest rates on car loans have hurt new vehicle sales in the U.S. In China, stiff competition from rising automaker BYD has made it difficult for the Japanese automaker to effectively stay ahead in Asia.

Earlier this year, Nissan and Honda were in talks to merge. Ultimately, the two companies could not make it work, and the proposal worth $60 billion was canceled. Combined, they would have been the fourth-largest automaker in the world.

Nissan was also on track to build a battery and electric vehicle factory in its home country. Yet, that plan was axed as the company reevaluates any new investments.

Now, Nissan is finding ways to save 500 billion yen ($3.4 billion) this fiscal year. As it navigates the future, the automaker has not issued any financial outlook as yet.

Espinosa replaced former CEO Makoto Uchida in April. Now, it’s up to Espinosa to turn the company around.

“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,” Espinosa said. “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.”