It looks like Nissan is done with bulking; cutting season has begun. If a news report out of Japan is to be believed, nearly 2,000 U.S. factory workers could be without jobs by the end of the year as the automaker goes lean ahead of merger talks with Honda.
According to Yomiuri Shimbun Online, U.S. manufacturing plants in Smyrna, Tennessee, and Canton, Mississippi, could see their active lines go from four to two. This is part of Nissan’s November pledge to cut 9,000 jobs worldwide, 70 percent of which are on the production side. Also, 20 percent of its global production capacity would be slashed.
The U.S. facilities in question have a production capacity totaling about 1 million units, which would decrease by 25 percent with the shutdown. Yomiuri Shimbun says Smyrna would be affected first, sometime after April, while Canton changes would occur after fall. No word on which vehicles, but Canton is home to the Altima and Frontier, while Smyrna produces the Murano, Pathfinder, Rogue, and Infiniti QX60.
Responding to the Japanese media report, Nissan North America’s VP of Communications, Brian Brockman, told Automotive News, “Any production adjustments for U.S. manufacturing facilities have not been finalized nor announced.”
Whether these specific production cuts are confirmed or not, Nissan will undoubtedly trim the corporate and production fat. By a lot. Also discussed in November, the automaker announced an updated full-year profit forecast—lowering it by 70 percent. But remember that such forecasts reflect future growth. Although Nissan cut theirs by an astounding percentage, the company still expects to turn a profit. AN reported that Nissan was able to cut 500 salaried jobs in the U.S. last year through voluntary buyouts versus layoffs.
Nevertheless, more significant cuts to jobs and vehicle production wait ahead. However, the U.S. remains a key market for Nissan. Last year, sales were up 3.8 percent year-over-year for the Nissan brand. The fourth quarter was particularly strong, with an 11.4 percent improvement over the same period last year. Heck, even the Nissan Z outsold the Toyota Supra for the first time in forever.
So, it’s not exactly doom and gloom yet, but things look to be a rough ride long before the road smooths out. Here’s hoping the current downsizing and future merger with Honda will end as a win-win, with a stronger and more stable Nissan that employees, consumers, and investors can feel more confident about.
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