By on July 24, 2019

Nissan is currently preparing a financial report that is alleged to show its first-quarter profit falling by around 90 percent, necessitating over 10,000 job cuts. The company told the world to brace for a bad year in May, following an abysmal earnings report for the 12-month period ending on March 31st, 2019. At the time, CEO Hiroto Saikawa said the automaker had “hit rock bottom.” But Nissan is still falling, if reports are to be believed.

The Japanese company released a statement that vaguely refutes the claims against on Wednesday while also validating them. However, numerous unnamed insiders have suggested the reports are accurate and several named staffers acknowledged that the automotive firm was facing serious problems. 

From Nissan:

On July 24, 2019 the Nikkei Shimbun published an article regarding Nissan’s financial results for the first quarter of fiscal year 2019. The article was not based on any announcements by the company.

While the financial results for the quarter are still being reviewed, the operating profit figure reported in the Nikkei Shimbun article was broadly accurate. However, no official confirmation can be made until the final results have been approved by the company’s board of directors tomorrow. Following that approval, the company plans to announce the results on the same day.

We know Nissan is struggling in the United States. Years of angling for high volumes have tainted the brand’s image and necessitated heavy discounting, whittling down its profit margins as deliveries decline. It has become a snake eating its own tail.

“Deteriorating performance in the United States is a big issue that we’re facing,” Motoo Nagai, chairman of Nissan’s new audit committee told Reuters. “For a long time we were concerned with increasing volume [in America]. We were chasing numbers. Now it’s time to enhance the brand.”

Globally, Nissan still hasn’t recovered from the financial scandal involving Carlos Ghosn — who pioneered the high-volume plan, corporate alliance with Renault, and saved the company from disaster years earlier. Most official communications fault the automaker’s current plight on Ghosn’s “negative legacy.” But many investors are also concerned that the alliance is breaking down and fretting over the current management’s competency.

Saikawa, who was slated to be fired prior to Ghosn’s arrest late last year, initially said he would retire. But he is now staying on as CEO for an indeterminate amount of time. This has also been a source of concern due to the internal strife surrounding him. Although Nissan is currently hunting for his successor at his request — making an extended stay as chief unlikely.

Nissan’s quarterly results will be posted on Thursday. The job cuts are rumored to be isolated largely in Asia and South America.

 

[Memory Stockphoto/Shutterstock]

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54 Comments on “Report Claims Nissan to Announce 10,000 Job Cuts, Plummeting Profit...”


  • avatar
    redgolf

    I live a stones throw from the Nissan Smyrna, Tn. plant and know several people who work there, I guess all will know tomorrow whether there are going to be any job cuts there, but that plant has never laid off anyone except the so called “temps” and a lot of them either quit or are fired ( very high turnover rates ) the UAW had tried for years to unionize them, only to fail to turn the majority, there can’t be to many full wage employees left as most of them took buyouts several years ago.

  • avatar
    dividebytube

    When I was a “Japanese car only” kind of guy, Nissan was a nice alternative to Honda and Toyota. I owned a few and loved them. It seemed – at least to my perception – to have the same quality but some great models like the Maxima, the Hardbody truck, the Sentra SE-R, the 300ZX, the 1st gen Pathfinder, the Xterra. Now? Meh – the Frontier is still ok. No real interest in anything except maybe a 350Z/370Z.

    It’s going to take a major change for the company to interest me again in buying another one of their products.

    • 0 avatar
      sgeffe

      My experience in a rental Versa SV last week said a lot!

      More of an appliance than a Toyota, with probably lesser quality. Merely competent, if that. Certainly nothing to recommend it over a Fit or Yaris.

  • avatar
    Jon

    Nissan used to be a fairly reliable and cheap alternative to everything else. The Titan XD with the Cummins could have been a reliable cheap alternative for the weekend camper, contractor, landscaper or anyone who regularly towed 6-10k lbs. Instead, they received several horrid high profile reviews that scared a lot of potential customers away. Great idea – poor execution.

    • 0 avatar
      MoDo

      Not poor execution, they tried to compete against Dodge, Chevy and Ford and got spanked, as everyone knew they would. Ask Toyota how it worked out for them – 12 years later and they’re still trying to make back the billions they sunk into the Tundra back in 06.

    • 0 avatar
      JoeBrick

      NO. Nissan used to be a VERY reliable car maker. I had 3 of their pickups, a ’73 Datsun, and a ’87 and a ’90 Nissan, all bought new, that I had zero problems with for the entire time that I owned them. Well, with one exception, the glove box latch DID break one the ’90 but it cost me around $5 and 5 minutes to fix it. Needless to say, they were my favorite and my goto car…er…truck company. But their quality has slipped a LOT lately. My new goto company is Honda. Sorry, Nissan.

      • 0 avatar
        highdesertcat

        ” Nissan used to be a VERY reliable car maker.”

        Yup. I know a few former Nissan owners (Maxima and Frontier) who ditched the brand in favor of another brand.

        Biggest complaint was the switch to a CVT in the cheapified sedans and the tinny-ness of the newer 4-banger Frontiers.

        OTOH, a four-door RWD Titan SV for UNDER $30K (with $1000 military discount) can be recognized as one sweet deal. And many a young airman (without established credit) in my area is scooping one up.

  • avatar
    stingray65

    Wait – you mean the Leaf isn’t the big profit maker they thought it would be? I just don’t understand it, because I’ve been told hundreds of times that the world is going electric, and just look at the huge profits Tesla is making…

    • 0 avatar
      SCE to AUX

      Nissan never promised the Leaf would be profitable, but there was a brief moment when Mr Ghosn said that it was nearing profitability, IIRC.

      No matter, because Nissan has completely ceded its early lead in EVs to Tesla, failing to improve their technology much beyond the improvements made in 2013. Now they’re outsourcing battery production, which will hurt their cost structure even more. They still use an air-cooled battery (only larger now), and today’s Leaf is essentially the same as the 2011 model except with 2.5″ more rear legroom.

  • avatar
    R Henry

    Is there a gifted corporate leader, anywhere in the world, who can bring Nissan back from this low water mark? I hope so!

    I REALLY liked my manual gearbox Maximas…my last one being a 2003 model. My wife drove a ’93 Altima (manual) for 150k miles, and loved that too. I drove a very long commute (86 miles each way!) in a ’96 Sentra for years–was as reliable as Old Faithful–while returning nothing less than 35 mpg. None of my Nissans ever required anything but maintenance. Truly, I never needed to replace an alternator, water pump, radiator…NOTHING.(–well almost nothing…I did need to replace the mass airflow sensor on my Sentra at around 120k miles.) They were very well made cars. The Maximas had the added benefit of being fun to drive. I hope Nissan get’s its mojo back!

    • 0 avatar
      brn

      “Is there a gifted corporate leader, anywhere in the world, who can bring Nissan back from this low water mark? I hope so!”

      There was, but Lee Iacocca just passed.

  • avatar
    WalthamDan

    The first thing Nissan needs to do is dump the CVT and admit that they just do not know how to build a competitive one. Their vehicles often rest at the bottom of customer satisfaction surveys within each model segment. Reliability has continued to decrease. And the programs/quotas they inflict on their dealers has destroyed the customer experience.

    They use to be a true alternative to Toyotas and Hondas. Now they firmly sit in the secondary level of Asian brands and require excessive incentives to move off the lot.

    It will take a major revamping of their design, drivetrain and dealer programs to right this ship.

    • 0 avatar
      APaGttH

      The first thing Nissan needs to do is dump the CVT and admit that they just do not know how to build a competitive one…

      The CVT was a huge reason a Maxima did not land in my driveway. The useless Infotainment system that on the surface looks so good, but can’t run Android Auto for 30 seconds or Apple Carplay for 5 minutes was the other deal-breaker.

      The tight backseat was a slight consideration but I don’t carry 2+ that much anymore, funkyish styling was more of a plus in the land of blobs.

      The last 5% that kept out of the driveway was the Lacrosse puts up better performance numbers 0-60 and 1/4 mile, so the Maxima couldn’t even say, “but I’m faster, just buy an extended warranty and accept you’re replacing the transmission one day!”

    • 0 avatar
      SSJeep

      Agreed, Nissan has been left withering on the vine pretty much the whole time Ghosn has been involved. Standardizing on the CVT was a huge mistake, as was pursuing high volume and low-margin sales. There isnt a single Nissan model that sticks out as something I would want to purchase, and I dont know anyone who has purchased a new Nissan in the last 7 years.

      What Nissan has done with Infiniti is downright cruel. Infiniti cant compete with any other luxury marque and often cant compete with loaded standard models from South Korea.

      I honestly cant figure out why they have chosen to languish so badly in a changing market, but Toyota is starting to take the same path. The steady fall of Nissan should be part of every business students curriculum, and Toyota executives should take note.

  • avatar
    APaGttH

    A product line that is too deep – too many vehicles in too many niches.

    Product offerings where styling went too far for the NA market (Juke and Cube Exhibit A & B)

    Neglected performance line in the Maxima, which looks like an Altima, and the 370Z which is ancient and at this point non-competitive.

    Three letters. CVT – and more specifically a well-deserved reputation for reliability issues and joyless shifting in some configurations.

    Infiniti is every bit as sad as Cadillac and Acura.

    Oh wait, there is a Nissan Sentra???

    Titan is utterly uncompetitive.

    Frontier is outdated and ignored (yes, update is coming, I know)

    Altima is a fleet darling of rental agencies everywhere, which hurts resale value.

    No credit, no problem, no job, no problem, no down payment, no problem financing to keep volume up.

    The brand has big problems.

    • 0 avatar
      SCE to AUX

      I still like the Kicks a lot. It’s the leading contender to replace my Optima Hybrid if that should happen soon.

      • 0 avatar
        JoeBrick

        I like the Kinks too. Their first album, was a blockbuster, of course, with You Really Got Me, and To Much Monkey Business, and the other basic rock’n’rollers, it was bound to be a hit. Their next few albums had some good hits, but their album Live At Kelvin Hall still holds up today. And don’t forget Lola versus Powerman and the Money-Go-Round was fantastic, containing four smash hits, including Lola and Apeman. And don’t forget their ode to a failing America during the Jimmy Carter years, Catch Me Now, I’m Falling. I can do without a couple of their albums, but…oh wait ! Did you say “Kicks” or Kinks ? Never mind.

        LOL

    • 0 avatar
      PSX 5k Ultra Platinum Triple Black

      I have a rental Sentra right now, if you leave the transmission in L all the time, it’s a fun little shitbox to abuse with decent power. Just gotta leave the transmission in L and turn up the radio. Nothin’ drives better than a rental.

      My ex and I beat up a Nissan dealer and got a 2013 Juke SV lease for $197 a month with only the first payment down. He liked the way it looked, but it was a fun little car to drive. The turbo and the cvt actually worked pretty well together in that car, it would peel out super easy. He wanted a manual, but the lease special was only for the auto.

  • avatar
    crtfour

    I don’t understand whey they keep going with the same CVT transmissions. There are 2 co-workers in my office alone who will not buy another Nissan based on CVT failures. That seems like kind of a big problem as you don’t hear people saying that about Toyota’s and Honda’s for the most part.

    • 0 avatar
      JoeBrick

      I have a CVT in my Honda Civic. I hope the CVT in that is better than the ones in the Nissans. Yeah, I was wary about the CVT, but since I am only LEASING it, I figure it’s not my problem if it craps out. *Keeping my fingers crossed*

  • avatar
    TimK

    Canary in the coal mine?

    • 0 avatar
      APaGttH

      I don’t think so – remember, under US accounting rules Nissan was functionally bankrupt in the late 1990s. The company has had some degree of a struggle for two decades now.

  • avatar
    ToddAtlasF1

    Maybe the malicious prosecution of Carlos Ghosn produced bad optics.

    • 0 avatar
      SCE to AUX

      I agree on the malicious part, but I can’t connect the dots between that and quiet showrooms. 99.9% of the public can’t name who runs/ran Nissan, and they’re unaware of its corporate drama.

      • 0 avatar
        ToddAtlasF1

        There were lots of headlines and cable news stories in the mainstream media. It’s quite possible that customers for Nissan’s more profitable models aren’t as ignorant as you think, and the percentage of Americans who actually buy new cars is much smaller than people think.

  • avatar
    poohbah

    The problem is poor quality after the Renault merger and horrible CVT transmissions. Nissan owns part of Jatco, so that’s a problem if their own doing. Scotty Kilmer must be laughing at the news, he’s been warning people not to buy Nissans for years.

  • avatar
    3800FAN

    Fleet crack addiction is the same mistake the big 3 made before the bailouts. Youd think nissan woulduv seen their mistake and not gotten addicted to fleet sales but they did. Nobody I know considers nissans for that reason…no resale value rental car brand

    • 0 avatar
      redgolf

      I probably drive by the Smyrna, tn plant several times a week noting how many cars are in the holding zone ready for shipment, week after week, month after month ,cars, SUV’s everywhere, i thought , who is buying all these Nissans? Car rental agencies, I found out! Oh! that’s the reason for over building, dump them on the rentals!

  • avatar
    tonycd

    The problem is as simple as the nickname “Le Cost Cutter.” Nissan was eaten from within by the same disease that’s destroyed GM, Ford, Fiatsler and various other corporations in most every manufacturing industry: the obsessive chase of quarterly profit totals to feed the Wall Street beast and thereby boost the CEO’s compensation. The transmissions are just one symptom of an overall cheapening – in parts, assembly quality and slashed R&D – that’s inevitably resulted in stale, uninteresting, unreliable and uncompetitive cars and trucks.

    Is there a solution? Sure. Short-term, don’t buy Nissans and they’ll adapt or die. In the bigger picture, support financial and political reforms to corporations and financial markets that will force companies to pay heed to a longer time horizon and remain a viable enterprise. That will restore the incentive that used to exist for execs like Ghosn to not devastate the company’s products and brands for a short-term profit grab.

  • avatar
    el scotto

    Other than the Z, I don’t think there’s many cars Nissan executives lust over. The GT-R is a unicorn, sorry. Something happened to Nissan when they stopped making the Xterra. It wasn’t for the better.

  • avatar
    87 Morgan

    I have mentioned before, Nissan wasted zero time filling the void that was created when GM took Pontiac out back behind the tool shed and put it down. Pontiac built excitement, wider was better, and you too could lease one for little to no money down and your 600 fico score.

    Fast forward a decade and you have Nissan, quality that excites? Nah, probably not. But, with 4k on the hood we should have no problem creating a loan file enticing enough to get a bank to buy your loan at 14% for 75 months. Chasing sub prime nearly removed Mitsubishi, same for Nissan, and for sure killed off Pontiac. It is a zero sum game, sell today to sub prime and the general public gets to see what your product looks like tomorrow with some neglect and indifference baked in and decides that while boring, a Camry or Highlander sends a better message long term.

    • 0 avatar
      PrincipalDan

      Nissan is Pontiac

      Infiniti is Oldsmobile

      Discuss.

      • 0 avatar
        ToolGuy

        PrincipalDan,

        I offer this, without further comment:
        http://www.youtube.com/watch?v=E_lWJ38hidM

      • 0 avatar
        ajla

        Kia and Hyundai do the Pontiac -> Oldsmobile thing way better than Nissan and Infiniti.

        Nissan of 2019 is basically Japanese Dodge circa 2003. Or maybe Mitsubishi without the whimsy.

      • 0 avatar
        87 Morgan

        PD..I do not believe you to be wrong. Somewhere this your equation Mercury is Acura.

        In the end I believe that Infiniti will ultimately pay for the sins of Nissan in as much that Infiniti will be shuddered so the R&D dollars can be shifted to the Nissan product line. Too few Infiniti dealers vs the number of Nissan outlets, similar to the number of Olds dealers in the end. It was very cost efficient for GM to write a check to the remaining Olds dealers to go away as most had self selected and terminated their franchise agreement if they were a stand alone Olds dealer. They all saw the writing on the wall and those buildings have Hyundai, Kia, or Subaru on the premises now.

        • 0 avatar
          bd2

          Ghosn came close to shutting down the Infiniti brand.

          But all is not well in Lexus-land either.

          Toyoda had wanted to cancel the GS prior to the current gen, and this time it seems like he will get his way.

          LS 500 sales have been a disaster and there is no other market w/ substantial sales.

          That’s why there likely credence to the rumors of Toyota being interested in using Mazda’s upcoming RWD platform and straight-6 in order to cut development costs (which is what Infiniti tried to do using Daimler components, which didn’t work out).

    • 0 avatar
      redgolf

      I’m still driving my 97 Pontiac GP, bought it new, 179 k miles, as I’ve stated before on this site – original plugs and wires never been changed , runs and drives like a 5 year old car! Best $18,500 I’ve ever spent!

      • 0 avatar
        87 Morgan

        redgolf…I am not attempting to indicate that Pontiac or Nissan is necessarily a bad product. I am of the opinion each, in the end, was marketed primarily (again, not 100% but above 60% of sales) to the less than stellar credit profile which in the factory had subsidize with rebates and/or GMAC (Pontiac) or NMAC assistance to get the loans bought.

        Pontiac, in the end was a very durable product, as evidenced of the sheer number of them still in use today with little to no owner give a care to be seen. Again, a GM car will run poorly substantially longer than some German cars will run at all.

    • 0 avatar
      3800FAN

      So true! I called Pontiac the blue collar nissan back when the grand am was still being built and once Pontiac was shuttered nissan went downmarket and now they’re hitting rock bottom.

    • 0 avatar
      JoeBrick

      I don’t know if it is true, but the story that I heard is that the Obama administration told GM to kill Pontiac to get their big bailout. . Is this true, and if so, WHY ?

      • 0 avatar
        ToolGuy

        JoeBrick,

        Copied from my “Alternative History…” post:

        At the time the Pontiac decision was made, Pontiac was unprofitable and Buick was highly profitable. The U.S. government wasn’t going to support a brand with no viable/sustainable plan going forward.

        Straight from the VP of U.S. Sales:
        http://gmauthority.com/blog/gm/pontiac/why-did-gm-discontinue-pontiac/

  • avatar
    Steve203

    Besides layoffs/market withdrawals in India and South America, they have a honking big plant in England. They only offer a limited slate of models in Europe, and the only one that is really strong in it’s category is the Qashqai.

    Nissan has already announced the withdrawal of Infiniti from Europe, ending production of the two Infiniti models produced in England.

    With Boris Johnson the new PM, promising BREXIT on October 31st, deal with the EU or not, that English Nissan plant could see most of it’s market go *pift* in 3 months, with the company following Honda in supplying Europe from Japan due to the recent free trade treaty between the EU and Japan.

    Wiki says there are 7,000 people employed at the Nissan UK plant.

  • avatar

    Even stock photos show how bad Nissan paint quality is these days.

  • avatar

    What is the difference between Altima and Maxima? They look the same and all dimensions including wheelbase are the same. And no one want cars anyway. So why the duplication?

    • 0 avatar
      JoeBrick

      The Altima is available with all-wheel-drive, but not the Maxima. The cars look to be a similar size, but I believe that the Altima now has a more powerful mill than the Maxima.

      “Both sedans have four doors and seating for up to five. The similarities don’t quite end there, but they are two very different cars.
      Maxima is the more muscular and luxurious sedan of the pair, with a focus on performance and a premium interior. It’s powered by a standard 300hp VQ V6 and features a Sport Mode Selector for a customizable driving experience. The Altima—Nissan’s best selling car—focuses on efficiency with a standard 4-cylinder engine matched with an Xtronic Continuously Variable Transmission that together deliver 39 MPG Highway. [*]
      The quick answer is that Maxima is built for performance, while Altima is built for efficiency. Which one is the right one for you depends on your priorities.”-
      from the Nissan website.

    • 0 avatar
      3800FAN

      They maxima has been a spruced up v6 Altima since the 2004 model. I considered a 2013 maxima but was shocked to see how cramped it was inside and got a used v6 Accord instead.

  • avatar
    3800FAN

    Since Renault took control of nissan in 2000 their reliability and quality have gone down the shitter. They went from being reliable cars that were kinda awkwardly proportioned to cars that were the right size but cheap and unreliable and this is all due to Carlos Goshen. He got the product right (2002 altima, 04 maxima, 2005 rouge)saved the company but then drove them to obsessing over cost cutting (2002 Altima 04 maxima 05 rouge) and market share chasing and today’s mess is the result. Now nissan is where Pontiac was in the 2000s and its gonna take them 5-10 years of higher quality products to get their reputation back and I don’t see that happening. Just forget nissan and get a Honda.

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