Nissan announced it will close seven plants in the following statement.
Nissan Motor Co., Ltd. announced today a recovery plan that implements decisive and bold actions to enhance performance and create a leaner, more resilient business that adapts quickly to market changes. With a fresh focus under new management, Nissan is reassessing its targets and has conducted a comprehensive review of key initiatives, introducing further measures to ensure a strong recovery.
Nissan president and CEO Ivan Espinosa said: "In the face of challenging FY24 performance and rising variable costs, compounded by an uncertain environment, we must prioritize self-improvement with greater urgency and speed, aiming for profitability that relies less on volume. 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. Re:Nissan is an action-based recovery plan clearly outlines what we need to do now. 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."
With Re:Nissan, the company targets a total cost savings of 500 billion yen versus fiscal year 24 actuals in fixed and variable cost savings. These savings will establish a framework to secure operating profitability and free cash flow in the automotive business by fiscal year 2026.
Variable cost reduction: In the new plan, Nissan has set an aggressive cost reduction target of 250 billion yen. To achieve this, the company is accelerating engineering and cost efficiencies while implementing a rigorous governance model. A dedicated cross-functional transformation office under Chief TdC Officer staffed by around 300 experts, has been established and is empowered to make cost decisions.
Additionally, Nissan will temporarily pause advanced and post-FY26 product activities to mobilize 3,000 people to focus on cost reduction initiatives. This reprioritization was made possible through the company's swift implementation of a shortened development process that reduces lead time and ensures no delays in product launches.
A key aspect of this transformation involves rethinking the supply chain; Nissan will restructure its supplier panel to secure more volume for fewer suppliers, eliminating inefficiencies and challenging legacy standards.
Fixed cost reduction: While maintaining a strong focus on variable costs, Nissan will continue to seek additional opportunities to reduce fixed costs, targeting a total reduction of 250 billion yen by FY26 compared to its FY24 actuals.
Restructuring manufacturing base and refine efficiencies: Nissan will consolidate its vehicle production plants from 17 to 10 by fiscal year 2027. Additionally, the company will streamline its powertrain plants and accelerate job reformation, work shift adjustments, and capital expenditure reductions, including the cancellation of the planned Lithium Iron Phosphate battery plant in Kyushu.
Reduction of workforce: Nissan aims to reduce its workforce by a total of 20,000 employees between fiscal years 2024 and 2027, which includes the previously announced reduction of 9,000. This workforce reduction globally covers direct/ indirect roles and contractual roles in manufacturing, SG&A and R&D functions. Additionally, Nissan will implement further measures under SG&A, including expanding the scope of shared services and identifying efficiencies in marketing.
Revamp Development: Nissan is revamping its development processes by reducing engineering costs, complexity, and improving development speed. Through various initiatives such as rationalizing global R&D facilities and allocating work to competitive locations, Nissan aims to reduce the workforce's average cost per hour by 20%.
Nissan will reduce parts complexity by 70%, while the integration and optimization of platforms will decrease the number of platforms from 13 to 7 by fiscal year 2035. The company will advance its efforts to significantly shorten the development lead time of the first vehicle to 37 months and subsequent family vehicles to 30 months. Models developed under this process include the all-new Nissan Skyline, the all-new global C SUV, and the all-new INFINITI compact SUV.
Redefined market & product strategy: Nissan redefined its market approach to better match local customer needs and tailor product strategy to align with the updated market approach. This will enable Nissan to focus on internal engineering resources in core businesses to ensure growth while securing profit.
Nissan is reshaping its product strategy to be more market-focused and more brand-oriented. Commitment to innovation will accelerate, bringing exciting advancements to valued customers. It will be centered around signature Nissan models that deliver strong nameplates which represent the heartbeat of Nissan globally, volume-driving models that will be the key drivers of the company’s performance and growth.
The market-specific approach will be positioning the U.S., Japan, China, Europe, Middle East and Mexico as key markets and adopt a customized approach to other markets. In the U.S., it includes addressing rapidly expanding segments such as hybrids and revitalizing the INFINITI brand through synergies with the Nissan brand. In Japan, expansion of model coverage will contribute to reinforcing the brand in its home market. The approach in China will focus on enhancing domestic performance with NEVs. Also exports from China will support catering to diverse and global needs. In Europe, the focus will be on B and C segment SUVs. Nissan will leverage partnerships with the Renault Group and partners from China to further diversify offerings. In the Middle East, the company will focus on large SUVs while exploring products from China to enhance competitive offerings. Mexico will continue to serve as an important export hub, contributing significantly to profit and growth.
Reinforce Partnerships: Nissan will collaborate with partners to deliver models that complement its portfolio and meet unique market needs. Several projects with its alliance partners, Renault and Mitsubishi Motors (MMC) are underway, including the recently announced initiative for an all-new battery electric vehicle (BEV) based on the next-generation LEAF for MMC's North American market. Nissan and Honda will continue their collaboration in vehicle intelligence and electrification.
Re:Nissan clarifies the necessary steps to recover performance and establishes clear timelines following a comprehensive review of the company's current situation. Although the targets are ambitious, the strategies and actions are well-defined. Nissan remains committed to the steady implementation of this plan to recover performance.
69 comments:
They are going to keep the most profitable and productive plants and close the least profitable and least productive plants. That is the ONLY reason to close the Canton plant. So let’s see if the lower salaries are enough to offset the outright theft and low QC caused by laziness and incompetence.
I hope and pray we don't loose that plant.
Nissan swallowed the Biden EV bait hook line and sinker- and have this to show for it.
@5:47 I hate Biden as much as the next guy. But Nissan innovated the Leaf in 2010.
Also, outside of the USA, Nissan is known for powerful and efficient turbo diesel Trucks and SUVs like the Terra and Navara. I have driven both and they are great. It is unfortunate that we can’t get anything like that here. They probably also see that GMC did poorly importing the Isuzu D-Max engine and rebadging it at as the GMC Canyon Diesel. It is a shame that the only diesel engines that sell well here are very large and very expensive.
I work there, they are in the midst o f doing buyouts to the tune of $100,000 for anyone with 15 years or more seniority $75,000 for 10 to 14 years, and $50,000 for anyone else. I have heard there were about 1000 takers. That's a lot of $$$$ to shell out voluntarily to close down so soon afterwards. I'm not saying it can't or won't happen, but I wouldn't pay out that much money if I didn't have to.
It has had major problems with its transmissions over the last decade or so. The cars aren't as good as they used to be. Once, the Maxima was equal to the Accord and Camry. Not anymore.
The threat of tariffs may keep Nissan in canton as much as I hate to say it.
Quality of Nissan has gone downhill all of this just about matches the timeline when they started the Nissan plant in Canton. Running 10/12 lines full blast 24/7 in a place where most people never even held a part time job let alone thousands of committed employees needed all day everyday forever. Oh the promises they made...very few kept. They had to go back on the point system after they hired and fired everyone in Central MS and further. The Sr. Managers are miserable and hate the workers and Mississippi. Japanese never want to stop working vs. large amount of employees that never show up on time or call in or quit...almost 4500 people and half can't show up on time and work 8 hours. My hats are off to the people that made a career out of that.
Nissan now has a yen for cost cutting.
They will do everything except make a reliable transmission, they are now known for an unreliable transmission. The Frontiers are good trucks and the cars could be, they will do cartwheels naked to cut costs but this is when they should double up on making reliable vehicles that people like. Reliability is number one in most peoples book. Nissan, get a grip on number of different platforms, get reliable instead of cheaping out on reliability and watch the company turn around. They should appologize for making unreliable cars and announce those days are behind us. If they don't know why they are, ask a dozen transmission shops--they will tell you--it is not a secret.
I've recently heard a prediction that, even if Nissan were to leave that plant, some other solvent automaker (Toyota, Honda, etc.,) might take the operational Canton facility (USA) to produce some of their lines to avoid tariffs that may ultimately come into play
The lowdown I have gotten is that Nissan wants to keep Canton open, with it being one of their youngest plant. Talks about improving automation inside the company and use Canton to do so, but of course that will result in the loss of some jobs...
That is right. Loose plants sink ships.
Nissan USA has nobody to blame but Nissan engineering.
Buyouts of those with the most service years are often offered in order to replace that staff with lower all-in priced headcount.
Build better cars, or close even more.
Nissan is hammered by the new tariffs (and uncertainty about the tariffs). The possibility of a recession in the near term makes it really hard to either merge with a competitor or perform a
reorganization/turnaround.
Significant possibility of a total shutdown/liquidation.
Correct...
Everyone bitching about Nissan transmissions needs to realize that NOBODY makes a good CVT except Toyota. And their patent is licensed by a lot of other manufacturers. Nissan’s sucks and they should go back to making old fashioned transmissions. It is unfortunate that so many Americans can no longer drive a manual transmission because they still make a solid manual gearbox.
They could just move the plant to a location with a better workforce.
You are right Kingfish and 7:21 pm. My husband was there with a supplier for over 5 yrs. He always had access to immediate production and all testing processes. Started out all well and good. Engineering DID screw it up for them. No accountability, whatever happens, oh no don't report that person or deficiency, no corrections.. on and on.
@kingfish 6:03PM - No Maximas produced since mid-2023.
calos ghosen took a chance on mississippi in bringing nissan here.
how many CEOs of dow jones and S-P 500 corporations can you say that about?
ghosen brought nissan up to par with honda and Toyota .
then the company tried to screw him with those bogus criminal charges in Japan.
ghosen proved he was smarter than they were when he escaped pretrial detention in japan and return to Lebanon , a country that will not extradite its citizens.
after what they did to ghosen , piss on nissan.
nissan now makes a bad product at an even worse price.
If nissan stops making the Altima, what will single moms drive?
AI retooling will eliminate thousands of jobs throughout the industry, that's fact. To be competitive all manufacturing and almost everything else will experience huge layoffs and some closures of "inefficient operations" throughout this country. Nissan is just trying to get out front. Much more to come.
The possibility of a recession in the near term makes it really hard to either merge with a competitor ...
Recent inability to find a merger partner has nothing to do with any recession possibility.
The way they screwed over Ghosn was criminal. They should be the ones in prison, not him. Didn't Honda back away from the merger?
Ghosn is in Lebanon….the only guys in prison are the retired american ops guys who secreted him out of Japan for money. They are in jail for life while Ghosn eats tabbouleh and hummus. And MS gave 1 billion dollars for that plant and Nissan avoided state, city and federal taxes since it was built in Canton. And for what? Add in beef plants and crazy fuel cells and rocket booster plants and coal plants that don’t work…..we can’t even legalize dope right…..MS…at the bottom of every metric for a reason.
They should make a cheap dependable basic truck like the old days and sell it for $30,000 and they would not be able to keep it in stock. It would sell to tons of contractors and people that just want basic transportation.
I know he is.
No Recession, find something else to fuss about-
Where is Danny Glover when we need him?
Can we get a comment from Danny and Bernie? https://www.nbcnews.com/news/nbcblk/march-mississippi-danny-glover-bernie-sanders-are-taking-nissan-n728776
If Nissan leaves, you can bet that Bill Crawford will blame Trump.
https://www.facebook.com/WSMVTV/videos/622101420859148/?__cft__[0]=AZXmsZYi2ugn9pfLohgzidzl95l1kl7Ql2ez0fUzGn6QrdVNvJxL9SOetBmmnqeb039v-6ybqaZ3fqayk2ywzSSmJBBHlgr6OOaSvFmL-m54a4WwyTyeJumctDJC7bYQ0mguhZv2bqDoCu6-Gpsv_84ffvEfmAwlIgQkkXaTqciDWpQc3FGgpJI6uPAl4EOJs5ai29HMoZ4u78cia83qqzGBcUExIZ0pWJDQqF0Ce2w2Cw&__tn__=-UK-R
6:48 nails it. The cars aren’t good. Cutting all these costs and heads won’t make the cars good. This appears to be the beginning of a death spiral.
Another moronic management decision. Supposedly coming out with an all new generation in 2025 that is fully electric. Brilliant!
10:14 PM said: “If Nissan leaves, you can bet that Bill Crawford will blame
Trump.”
Yea, and with a closing bible verse; while not daring to criticize his Democrat Party for their love of violent criminals, and purposeful soft on crime tactics used to makes cities like Jackson, MS a one-party Democrat controlled forever city (since if crime left Jackson, people that don’t vote Democrat would move to Jackson in droves).
Did Bill or Sid or judge briber funded MS Today have an “Opinion” when 2 innocent children were killed by stray bullets within 10 days, and Kenneth Stokes called Jackson the child killing capital? If so, and we missed it, please post the link(s). Otherwise, innocent children dying doesn’t appear to be an “issue” worthy of their “Opinion” for Democrats.
That tire plant in Bolton will be affected as well. Auto production curbed, tire production curbed.
Entergy incentivized that plant as well. The Elvis impersonator will remember...
And then there is the Armada - what else needs to be said?
9:53pm True That
Of the 31 Nissan Plants around the world—-the Canton plant is the worst. Highest recall rate - highest absentee rate—among many issues. The Mgt team went to Mexico to observe how that plant operates so well. — with no immediate improvement afterwards. The Japanese business culture is relentless— something the workers at the plant never bought into. Hope the survive.
Yep, and in Europe and other areas a manual transmission is the standard, because they get better mileage.
With all the new auto plants announced in the U.S. coming soon to fruition and Nissan is in a world of hurt. The product sucks and quality of Mississippi manufacturing seems poor
That Continental plant makes big truck tires.
My manual Nissan has been great and was low cost, both to buy and to run.
Nissan will take care of Smyrna TN plant, Canton has always been the red headed step child.
Like the old Levi's plant in Gluckstadt, I'm sure Amazon will purchase the Nissan plant and land for further use.
@7:54 Japanese business culture isn’t any worse than Tesla and SpaceX business culture. The problem is that the US law says you have to give everyone a chance and maintain a diverse workforce and pay them equally despite that diverse workforce providing unequal outcomes.
And that culture causes a general decline since the hard worker can’t get rewarded without the lazy worker demanding the same rewards, or else they claim the reason is something other than their performance.
Tesla and SpaceX are also very cut-throat but Elon is South African and acutely aware of how to deal with this situation and also properly document and track every personnel issue to fend off the accusations.
@8:32 exactly. They don’t design and make bad cars. Those CVTs are just so bad. Their truck transmissions are not CVTs.
I think if the Nissan Canton Plant closes then Trump should make a deal and let BYD buy the plant and start making their BYD Shark pickup and their other DMi line of extended range EVs. Basically, hybrids that use electric motors with a small gasoline generator to extent the range.
FYI for those who don’t know. Tesla now uses BYD Blade batteries because they don’t explode and burn like the sun.
To all the ignorant green teeth rednecks who are trying to tie Nissan EV innovation to their decline. There is a Chinese automaker called BYD that is taking the world by storm. They can’t make them fast enough for Australia. Here is an Australian review of the BYD Shark pickup touring in the Outback.
I can't imagine being tasked with building a quality product with the labor force Mississippi has to offer.
Hiring a sufficient number of locals with a good work ethic must be a real challenge, as the video linked above explains.
BYD: Buy Your Demise? Does China hoover up data from driver's phone and laptop? Do they punch in a kill code to explode the battery?
"Is Nissan Canton on the Chopping Block?"
Dude, it was a yes or no question.
Served on the Madison County grand jury a few years ago. Almost every time we convened, we indicted someone from the Nissan plant for theft. One guy pushed a multi-million dollar robot welder off a loading dock and tried to drive away with it. Thousands of dollars worth of tools are thrown over the perimeter fences to be picked up by accomplices. Fortunately, most of that crap is caught on the plant's vast CCTV system. At least, I hope it is. Such is the state of the Mississippi workforce. Judging by what my friends tell me, virtually every business of any size in Mississippi goes through that. I'm hoping for the best for the Canton plant, but I just don't know...
There are brilliant, productive people here in MS, but also brilliant weasels who proudly take more than they give.
Nissan squandered a generation's worth of goodwill by not resolving their CVT problems. They've know about the CVT cooling problem for 15+ years.
@9:13AM, Word.
Levi’s was just a huge warehouse
@10:35 any of the car companies who connect your movile device do that. Most of them let you opt-out of the “telemetry” collection if you read carefully.
And the Chinese business like BYD arend some red-eyed monsters. They are trying to compete with Toyota and Tesla. Also, China isn’t Israel.
My understanding is Nissan was never really interested in merging with Honda. The merger was being pushed by the Japanese government that is worried Nissan could be bought up by a Taiwanese or even a Chinese firm.
9:39, you need that dope to be legalized the right way, don't ya? Lol
But I'm sure they're great workers who build solid, dependable cars.
Two $10 billion plants announced in MS in one year. Now get back to your mouth-breathing.
I will give Nissan USA the advice they need to save their company.
Spin off Nissan USA.
Stop making front wheel drive anything anymore. This will eliminate their shitty CVTs.
Focus on trucks and SUVs based on trucks instead of cars.
Focus on NISMO performance vehicles like the Fairlady Z and GT-R.
Develop a new mid engine V8 super car.
Reinvigorate the Nissan image as a performance company focusing on high horsepower, real wheel drive vehicles.
You will basically have 5-6 vehicles for consumers. Trimming the line down to just the right models.
Lots of speculation from a person supposedly on a grand jury. Prejudice much?
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