Nissan plans to offer early retirement packages to administrative staff in Japan starting in July. Officials announced on Sunday that this is part of the company’s efforts to streamline operations. Nissan is also considering closing two plants in Kanagawa Prefecture, including the Oppama plant in Yokosuka.
The carmaker wants to move away from its costly business structure, which includes excessive production equipment. Earlier this month, Nissan revealed plans to cut 20,000 jobs worldwide, including 3,600 administrative positions.
The job cuts are part of broader restructuring efforts aimed at addressing the company’s financial struggles in recent years. Nissan’s streamlining efforts show the challenges the automotive industry is currently facing, including overcapacity and increasing production costs.
The company hopes these measures will create a more sustainable and efficient business model. Nissan CEO Ivan Espinosa is implementing drastic measures to revive the Japanese carmaker. Espinosa has announced significant job cuts and factory closures following a major net loss.
These bold moves are part of Nissan’s broader revival strategy. The plan includes reducing operational costs and streamlining production to enhance efficiency and competitiveness in the global market. Nissan’s leadership is committed to making tough decisions that will pave the way for sustainable growth and profitability in the future.
Industry analysts and stakeholders are closely watching to see if Espinosa’s “shock therapy” can restart Nissan’s heartbeat and steer the company toward a more prosperous path. Nissan recently scrapped plans for a new battery factory in Japan. The cancelled production facility was part of a $1 billion investment.
Nissan’s strategic cost-cutting measures
The automaker was also scheduled to receive up to $384 million from the Japanese government to aid in establishing a domestic supply chain. Before cancelling construction of its battery factory in Japan, Nissan also closed its facility in Wuhan, China.
The closure and cancellation are part of the automaker’s examination and streamlining of its global operations. Like most other automakers, Nissan is facing falling sales in China. The company posted a net loss of $4.5 billion in its last fiscal year.
Overall, the manufacturer plans to cut costs by $1.7 billion to return to profitability by fiscal year 2026. As part of these cost-cutting measures, the company plans to cut 20,000 jobs by fiscal year 2027, up from the 9,000 jobs previously announced. They also plan to close seven production facilities over the next two years, reducing their remaining plants from 17 to 10.
Nissan’s primary concern is the United States and North America. The Japanese automaker’s lineup lacks vehicles in key segments, and much of its range needs updates. Nearly a dozen new or refreshed vehicles across Nissan’s mass-market and premium brands are planned to address this.
The next-generation Leaf will join the Ariya in the growing EV lineup, jumping from a hatchback to a crossover. The Leaf rides on the same architecture as the Ariya, which results in improved performance and range. The Japanese automaker will also launch the Rogue PHEV, the first plug-in hybrid for the brand, while the Pathfinder and QX60 will receive refreshed styling inside and out.
Nissan plans to introduce the next-generation Sentra later this year but will cut the Versa, one of the few remaining subcompact cars, from its lineup at the end of 2025. The Altima could be discontinued in 2026, but there’s no confirmation yet. Nissan’s financial troubles are significant, but they’re on the right track with a recent change in leadership and a plan to cut costs.
The Japanese automaker seems ready to enter the United States market with refreshed and redesigned models that can compete with market leaders. However, Chinese automakers are rapidly disrupting their home market and moving abroad, complicating Nissan’s recovery efforts.
