Nissan plans to merge with Honda into a new car group. But that doesn't mean the Japanese can spend a lot of money. On the contrary, 2,000 employees will be laid off.
According to the Yomiuri Shimbun Online, Nissan is planning extensive job cuts in the North American market. At the brand's factories in the US alone, 2,000 jobs are set to be lost.
The decision comes as a result of a need to reduce costs and streamline production.
The cuts are part of a larger global strategy in which Nissan plans to lay off 9,000 employees worldwide. 70 percent of the employees will be in production, it says.
Nissan's plants in Smyrna, Tennessee, and Canton, Mississippi, are expected to be hit hardest by the cuts. Not only will employees be laid off, but the factories will also shut down two of a total of four active assembly lines each.
In this way, Nissan can reduce its production in the US by up to 25 percent. According to Yomiuri Shimbun Online, Nissan will start closing assembly lines and laying off factory employees as early as April.
The next round of layoffs will follow in the fall. Nissan has not released further details on which specific departments or positions will be affected by the layoffs.
But the cuts come at a time when Nissan is facing a series of financial challenges and a potential merger with Honda. The carmaker has acknowledged that it only has enough money to stay afloat for a year. That's why the drastic cuts are necessary.
Speaking to Automotive News, Nissan's North American PR manager Brian Brockman would neither confirm nor deny the layoffs, nor would they comment on further cuts at the factories.
The cuts in the US are just one of a series of measures Nissan is implementing to reduce costs and improve efficiency, with the automaker aiming to cut at least 20 percent of its production capacity overall.
As an official statement from Nissan is yet to be released, it is uncertain exactly how the cuts will affect the company. On the other hand, it was revealed this week that the Japanese are dropping an American-developed SUV that is smaller than the Qashqai. The customer base is simply too small.
The Japanese are far from the only ones cutting back to keep their business afloat. Back in November, Volvo Trucks announced that 250 layoffs earlier this year were not enough. And that they will lay off more. Sales simply can't keep up with production.
The situation is drastically different in Germany, where a 78-year-old subcontractor threw in the towel on Thursday last week.
1,600 employees lost their jobs. This happened, among other things, because negotiations with a Chinese investor collapsed completely shortly before Christmas. Read more about it here .
Things aren't much better on two wheels either. Austrian KTM is struggling with a billion-dollar debt. And most recently, investors have demanded that they get at least 18 billion kroner back. At the same time, the motorcycle manufacturer has over a quarter of a million motorcycles in stock.
This has already led to the dismissal of at least 500 of the 3,200 employees at the factory. At the same time, none of them received a salary in December. However, an agreement with the bankruptcy court means that a state wage guarantee fund found money instead.
Shortly before Christmas, it was also revealed that KTM has 90 days to try to save the business. In order to save money, the brand has already withdrawn from MotoGP. And just a few days ago it was clear that the managing director has finished.
