Nissan to slash 20,000 positions
Automaker also sees $2.9b loss
TOKYO - Nissan disclosed 20,000 job cuts yesterday, the deepest reduction among Japan's automakers in battling the global downturn, as it forecast its first annual loss in nine years.
Chief executive Carlos Ghosn said the latest problems were industrywide and due to the global economic slump and the appreciating yen.
They didn't mean Nissan Motor Co. was reverting to its money-losing status that required a bailout from alliance partner Renault SA in 1999, he said.
The last time Japan's third-largest automaker racked up an annual net loss was for the fiscal year that ended March 2000. Then, a bloated Nissan had lost money in seven of the previous eight years.
"In 1999, we were alone. In 2009, everybody is suffering," Ghosn, also the chief executive at Renault, said at Nissan's Tokyo headquarters.
Nissan now expects a $2.9 billion net loss for the fiscal year through March - joining a raft of other Japanese corporate giants, including Toyota, Toshiba, and Sony, in slashing jobs and projecting annual losses.
As a key step in weathering the downturn, Ghosn said Nissan will cut 20,000 jobs worldwide, or 8.5 percent of its 235,000-strong global workforce, by March 2010.
Some 12,000 of the job cuts will be in Japan, including group companies, and the rest will be overseas. The company did not give a further regional breakdown.
Mamoru Katou, analyst with Tokai Tokyo Research, remained pessimistic about Nissan's recovery prospects. Toyota and Honda, which both have gas-electric hybrids going on sale this year, are better positioned to boost sales when the recovery kicks in, he said. Nissan does not have a comparable hybrid model.
Nissan's job cuts in Japan - more aggressive than its domestic rivals - show its strategy to take production overseas and take advantage of the soaring yen but that would make the Nissan brand less popular in its home market, Katou said.
Number one automaker Toyota Motor Corp., which is projecting a $3.85 billion net loss for the fiscal year through March, its first such loss since 1950, is reducing contract workers in Japan from 8,800 in June last year to 3,000 in March.
Honda Motor Co., Japan's number two automaker, is faring relatively better and is expecting to stay in the black, with an $879 million profit. But it will cut the number of temporary workers at its Japan plants from 3,100 to zero by the end of April.
Nissan has already reduced its temporary plant workers in Japan by about 2,000 and slashed its British workforce by 1,200 at its plant in Sunderland, northern England, where it had employed about 5,000 people. It has offered early retirement to 1,200 workers in the United States, but that number will likely increase, according to Nissan.
A Nissan North America spokesman said yesterday, however, that the company does not plan to make additional cuts in the United States on top of those already revealed.
Among other measures, Nissan's directors will forgo bonuses for the year ending March.