Nissan to Cut 11,000 More Jobs, Close 7 Plants as Profit Plunges 88%

Nissan on Tuesday announced plans to cut 11,000 additional jobs and shut down seven manufacturing plants, as the Japanese automaker battles plunging profits, declining sales, and mounting pressure from global rivals. The sweeping cost-cutting measures follow a turbulent year that saw merger talks with Honda collapse, a change in leadership, and weakening demand in key markets.

The latest reductions bring Nissan’s total planned workforce cuts to around 20,000 jobs. The company will also streamline operations by reducing its global production footprint to 10 plants from 17 and cutting component complexity by 70%. Specific locations for the closures were not disclosed.

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Nissan posted an operating profit of 69.8 billion yen ($472 million) for the fiscal year ending March, down 88% from the previous year. The company withheld profit guidance for the current fiscal year but projected a 200 billion yen operating loss in the first quarter, Chief Financial Officer Jeremie Papin said.

“Our full-year financial results are a wake-up call,” new CEO Ivan Espinosa told reporters at a press conference. “The reality is very clear. Our variable costs are rising. Our fixed costs are higher than our current revenue can support.”

Espinosa, who stepped in as CEO amid growing instability, is aiming to achieve 500 billion yen in overall cost reductions. Nissan has been hurt by sliding sales in the U.S. and China and faces fierce competition from fast-expanding Chinese EV makers, particularly in Southeast Asia. The company is also feeling the strain from U.S. tariffs.

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Industry analysts attribute much of Nissan’s current predicament to its previous strategy under former Chairman Carlos Ghosn, who focused aggressively on volume growth and relied on deep discounts. That approach left Nissan with an ageing product lineup, which it is now racing to modernize.

While the restructuring plan marks Nissan’s most aggressive turnaround attempt in years, analysts say a quick recovery is unlikely amid continued market headwinds and internal challenges.