Business & Economy
Nissan reveals 12,500 job cuts – but no confirmation if Sunderland staff will be affected
July 25, 2019
Car maker Nissan is cutting 12,500 jobs to kickstart a turnaround plan – but has not revealed if its North East workforce will be affected.
The Japanese manufacturer has today (Thursday, July 25) confirmed it will axe staff and make changes to its global production strategy to address falling revenues and profits.
However, the business, which employs around 7000 staff at its factory in Sunderland, has not disclosed where the cuts will be made.
According to its plan, Nissan says its staffing changes – of which 4800 cuts were revealed in May – will be augmented by a ten per cent reduction in the business’ global production capacity by the end of its 2022 financial year.
It will also cut the size of its product line-up, which bosses say will allow the company to “improve product competitiveness by focusing investment on global core models and strategic regional models.”
The moves come as the business seeks to rebound from weaker financial results in the three months to June 30, which saw year-on-year operating profit fall 98.5 per cent and net income drop 94.5 per cent.
It was also affected by lower sales, with global unit sales decreasing six per cent to 1.23 million.
Sales in Europe – including Russia – fell 16.3 per cent to 135,000, and they were also down 13.1 per cent to 174,000 in Asia and Oceania, Latin America, the Middle East and Africa.
Nissan’s Sunderland plant, which employs about 7000 workers on Wearside and supports many more supply chain posts, is an integral element of the business’ European production operation, with the site responsible for manufacturing the company’s flagship Qashqai model.
Bosses previously revealed the plant would be responsible for making a next generation version of the model, as well as its Wearside stablemate, the Juke sport utility vehicle.
Its production lines also oversee manufacture of the company’s all-electric Leaf hatchback.
Confirming the company’s turnaround plan, a spokesperson said: “Nissan is implementing strategic reforms in order to build an operational base that will ensure consistent and sustainable profitability over the medium term.
“The company is moving quickly to optimize cost structures and manufacturing operations, while also enhancing brand value, steadily refreshing its line-up and achieving consistent growth globally, including in the US.
“Nissan will reduce its global production capacity by ten per cent by the end of fiscal year 2022 (and), in line with production optimisations, will reduce headcount by roughly 12,500.
“Furthermore, the company will reduce the size of its product line-up by at least ten per cent to improve product competitiveness.
“While some of these initiatives are already underway, the company expects that substantial improvements in its performance will take time.”
The spokesperson added the company will continue to invest in technology, such as driver assistance systems.
They also confirmed it will continue to expand into new business areas, highlighting its recently-announced exclusive agreement with Waymo to explore driverless mobility services in Japan and France.
Nissan’s Sunderland plant was previously identified as the company’s chosen base to make a new X-Trail model for the European market.
However, the firm subsequently made a U-turn, saying it had increased investments in new powertrains and technology for future European vehicles, which prompted officials to “optimise investments” across the continent by consolidating X-Trail production in Japan.
Nissan’s Sunderland plant has made more than ten million vehicles since production began with the first Bluebird in 1986.
The landmark figure was hit when a Qashqai (pictured left) rolled off its lines.
According to company figures, workers at the factory have made nearly 3.5 million Qashqais since production started in 2006, with 2.4 million Micras made between 1992 and 2010.
Staff have also so far made more than one million Jukes and in excess of 140,500 models of the Leaf.