Japan’s Nissan reportedly to double global job cuts to over 10,000

The job cuts, exceeding 7 percent of Nissan’s 138,000-strong workforce, come as Nissan struggles to improve dismal profit margins in the US, a key market. (AFP)
Updated 24 July 2019
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Japan’s Nissan reportedly to double global job cuts to over 10,000

  • The global plan includes the 4,800 job cuts announced in May
  • It will mostly be at factories overseas with low utilization rates

TOKYO: Nissan plans to expand job cuts to over 10,000 to help turn around its business, a person with direct knowledge of the matter said on Wednesday, as profit continues to plunge while the automaker grapples with management upheaval.
The global plan includes the 4,800 job cuts announced in May and will mostly be at factories overseas with low utilization rates, the person said. It will be announced along with financial results on Thursday, said the person, who declined to be identified as the information was still private.
Nissan declined to comment on the job cuts. Its shares ended the day up nearly 1.0 percent.
Analysts expect Nissan to post one of its weakest quarterly performances since the 2008 global financial crisis when it announces its first-quarter earnings on Thursday.
On Wednesday, the Nikkei business daily reported the automaker would report operating profit of “several billion yen” for the quarter, around a 90 percent drop from 109.1 billion yen a year earlier. Analysts estimate a decline of 64 percent.
The job cuts, exceeding 7 percent of Nissan’s 138,000-strong workforce, come as Nissan struggles to improve dismal profit margins in the United States, a key market where former Chairman Carlos Ghosn for years pushed to aggressively grow market share during his time as chief executive.
Years of heavy discounting to grow sales in the world’s second-biggest auto market have left Nissan with falling demand for the Altima sedan and other models, a cheapened brand image and low resale values, while the costs to offer high discounts have hit its bottom line.
The latest job cuts also highlight the extent of problems facing Chief Executive Hiroto Saikawa, who is also grappling with fractured relations with French alliance partner Renault following the arrest of their shared former chairman.
Ghosn has been charged with financial misconduct and denies wrongdoing.
Saikawa kept his job in a vote at an annual shareholders meeting last month, though he had to fight off a rare rebuke by top proxy advisory firms who urged shareholders not to reappoint him considering he was groomed for leadership by Ghosn.
In May, Nissan forecast a 28 percent plunge in annual operating profit, adding to a 45 percent fall in the previous year, putting the automaker on course for its weakest earnings in 11 years.
While addressing faltering performance, Saikawa also has to repair trust with Renault, which has deteriorated in past months as the French automaker sought more control within Nissan.
Renault owns 43 percent of the Japanese automaker, which in turn holds a 15 percent, non-voting stake in its partner. Saikawa, who has sought more equal footing with Renault, last month said Nissan would postpone discussions on the alliance’s future to prioritize performance.
The extended job cuts were first reported by Kyodo late on Tuesday.


Google plans to invest £3 billion in Europe

Updated 35 min 5 sec ago

Google plans to invest £3 billion in Europe

COPENHAGEN, Denmark: Google is planning to invest £3 billion to expand its data centers across Europe in the next two years.
The tech giant’s CEO, Sundar Pichai, says it will bring the company’s total investments in the continent’s Internet infrastructure to £15 billion since 2007.
Pichai met with Finnish Prime Minister Antii Rinne on Friday in Helsinki and said that the investments “will generate economic activities to the region” and support 13,000 full-time jobs in the European Union every year.
He said that Google is “taking another big step by making the biggest corporate purchase of renewable energy in history” — a 1,600-megawatt package of agreements that includes 18 new energy deals. Ten of these will be in Europe.