Nissan To Cut 20,000 Jobs, Shut 7 Plants Globally In Major Restructuring After $4.5 Billion Annual Loss

Nissan Motor Co. Ltd. (OTC:NSANY) (OTC:NSANF) announced major steps to reconfigure its global operations after a challenging financial year. The company said on Tuesday that it will slash thousands of jobs and close almost half of its production plants across the globe, as part of a multi-year restructuring plan targeted towards stabilizing its bottom line.

What Happened: The company shared plans to terminate nearly 15% of its workforce, which entails approximately 20,000 employees, by fiscal year 2027. This includes the 9,000 job cuts announced earlier. In addition, Nissan will also shrink its global manufacturing footprint, reducing the number of factories from 17 to 10 over two years.

Last week, reports emerged that the company is canceling its plans to establish a $1.1 billion electric vehicle battery factory in Kitakyushu, Japan.

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Why It Matters: Nissan faced a $4.5 billion loss in 2024, citing rising variable costs and ongoing global turmoil. "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," said CEO Ivan Espinosa. The company also noted it would prioritize U.S.-made products and move operations to sidestep tariff-related pressures.

"We are taking a prudent approach to reassess our targets and actively seek every possible opportunity to implement and ensure a robust recovery," Espinosa added.

Nissan was not the only major company to announce layoffs on Tuesday. Microsoft Corp. (NASDAQ:MSFT) shared on the same day that it will cut 6,000 jobs worldwide, amounting to about 3% of its total workforce.

Price Action: Nissan Motor stock closed at 354 JPY ($2.42) on the Tokyo Stock Exchange on Wednesday, down 0.70% for the day. Year to date, the stock has declined 25.44%.

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