By on January 29, 2020

In an effort to reduce expenses and lower its headcount, an embattled Nissan is offering buyouts to its U.S. employees.

It’s rumored that Nissan plans to eliminate thousands of white-collar jobs and shutter several global factories as part of its effort to improve the company balance sheet. Going into 2020 weak and not expecting to make any money, the automaker is turning its focus to restructuring for at least the next 24 months.

“To adapt to current business needs and improve efficiencies, Nissan will offer voluntary separation packages to eligible U.S.-based employees,” the company said in a statement. 

Most of the buyout details were withheld. Nissan only verified that the separation packages will be offered to employees over the age of 52, regardless of whether they stand on the line or sit at a desk. But the company said over the summer that it needed to cut 12,5000 jobs, plenty of which are bound to be located in the U.S.

Reuters framed the situation as truly ominous, reporting that the company hopes to eliminate over 4,300 desk jobs (mostly in Europe and the U.S.) and close two manufacturing sites as part of broader plans to add at least 480 billion yen ($4.4 billion) to its bottom line by 2023. It also presumed Nissan will cut down its lineup (for a time) while also reducing the number of options and trims available. The latter prediction, judging by new-for-2020 models, is already coming true. Marketing efforts are reported to receive less funding, as well.

“The situation is dire. It’s do or die,” a person close to Nissan’s senior management and the company’s board told the outlet.

From Reuters:

Most of the planned cuts and measures to enhance efficiency were presented to Nissan’s board in November and received its general blessing, two sources said.

A Nissan Motor Co spokeswoman declined to comment on new restructuring measures or the view that weaker-than-expected sales were the catalyst for a global overhaul.

Under Ghosn, Nissan embarked on a global expansion, boosting capacity to add new models, driving more decidedly into markets such as India, Russia, South Africa and southeast Asia and spending heavily on promotions and marketing to hit targets.

Now, many of those models are missing sales goals and executives at Nissan’s Yokohama headquarters estimate up to 40 [percent] of its global manufacturing capacity is unused, or under-used.

Internal documents obtained by Automotive News provide some additional insight. Beginning in July, the company will implement a smaller regional sales structure by eliminating the number of sales offices from eight to six. The manufacturer is urging dealers to keep their cool, saying this is something a lot of automakers are dealing with.

“Like many other automotive companies, Nissan North America is taking proactive steps to assess our structure, workflow, and operational efficiencies amid a challenging industry environment,” senior vice president Airton Cousseau wrote in a letter to dealers on Tuesday. “This reorganization will create office synergies that will enable a leaner organization while still focusing on dealer profitability and your ability to continue providing a quality customer experience. You will continue to receive all the support you need.”

 

[Image: FotograFFF/Shutterstock]

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23 Comments on “‘Do or Die’: Nissan Buying Out U.S. Employees As Cost-cutting Spree Continues...”


  • avatar
    dukeisduke

    Die.Already.

    • 0 avatar
      dukeisduke

      I have to clarify – I asked for this comment to be deleted – too harsh. It’ll be a hardship on Nissan employees here, and I don’t wish that upon them.

  • avatar
    dukeisduke

    I wouldn’t miss them. They used to make some good, appealing cars, but they’ve completely lost their way. It made sense when they added Mitsubishi to their alliance, since Nissan’s quality has been trending in a Mitsubishi-like direction.

  • avatar
    schmitt trigger

    Downsizing oneself to profitability…where have I heard this before?

  • avatar
    redgolf

    I know several of my friends that work at the Smyrna plant that are just waiting to take a buy out, good for them, all are over the age of 52 and making top pay but it’s easier said than done, it will depend on how much $$$ they will offer!

  • avatar
    tomLU86

    So, if Ghosn, “le cost-cutter”, effectively slashed costs, what is there left to cut in terms of vehicle content?

    I remember, around 2004-5, I had a chance to test drive an Infiniti. The one that competed with BMW 3-series.

    It drove well. I liked it. But after 20 minutes with it, I found the interior didn’t seem as nice as it was in the showroom.

    Then it struck me–THIS is what the automakers refer to as “Perceptual Quality”. It got me into the car. But over time, one realizes the car is cheaper than it appeared.

    So, Nissan masterfully disguised interior, and took something Camry/Accord grade and made it appear “luxury” (so, the interior was not as mediocre as a Pontiac Grand Am).

    Add ugly exteriors (versa, large truck, Maxima, Altima), and watch your sales shrink in North America.

    Now what? If Ghosn cut the fat, all you have left is muscle.

    At the end of the day, there are NO short cuts. Just ask GM.

  • avatar
    65corvair

    Had an Altima as a rental, I wasn’t impressed. My ’14 Accord (base model, no extras) with 140,000 miles was a better car. More features, smoother, faster and quieter. The tiny backup camera screen on the Altima was like it was foggy. Nissan needs
    to fix their cars. More equipment and more refinement is what they need.

  • avatar
    dividebytube

    A plan like this – reducing trim and options – will drive away customers; or increase their stigma of being a “bottom feeder” car maker. Vehicles for the terminally bad-of-credit?

  • avatar
    Jeff S

    Nissan should just keep cutting until they are no more. With all these articles about Nissan losing money and cutting costs it should be allowed to die. Please take it off life support along with Jatco allow them to die naturally.

    • 0 avatar
      highdesertcat

      The global auto industry is shaking itself out. It started in 2009 with the demise of GM and Chrysler, and the decline of Nissan is just an extension of that.

      What we in the US need to is import more disposable cars built in China, like we did when Hyundai and KIA were the cheapest disposable commuter cars in the US.

  • avatar
    Cactuar

    What challenging industry environment?
    Anyone with a pulse can borrow 40 grand on a new car these days.
    The sales are there, you just need the right product to capture them.

    • 0 avatar
      highdesertcat

      “Anyone with a pulse can borrow 40 grand on a new car these days.”

      I don’t think that generalization applies to retirees over age 55 or many who live on a fixed income of less that $30K/year. (Unless they belong to a Credit Union or USAA and have a ton of money socked away there.)

      I agree that Nissan products are NOT the right product for the majority of buyers, and going CVT did not help.

  • avatar
    Steve203

    Funny that TTAC has not picked up on FCA’s announcing buyout offers for 3900 at Belvidere. Belvidere laid off about 1300 a year ago, when they dropped the third shift. There are currently 3900 still working there.

    Can’t help but wonder what the future is of the plant, and what is the future of the Cherokee, which is only built at Belvidere.

    • 0 avatar
      highdesertcat

      “what is the future of the Cherokee”

      Uncertain. My guess is that real-world buyers will choose a V6 Grand Cherokee Laredo E (low $30s) over a Cherokee.

      • 0 avatar
        Steve203

        >>My guess is that real-world buyers will choose a V6 Grand Cherokee Laredo E (low $30s) over a Cherokee.<<

        I considered that possibility. Looked at the starting prices on the Jeep site. There is a $6,000 spread between the base price of a Cherokee and a GC. Reporting says the next gen GC will be even bigger. An extra $6,000, a 20+% upcharge from a Cherokee, would be a lot to ask of a lot of customers.

        It is certainly interesting to speculate what FCA has in mind. The Journey appears headed for a dirt nap as, according to the new contract, the 4 speed automatic, which is now the Journey's only trans option, goes out of production this year. Without either the Cherokee or Journey, FCA abandons a huge part of the SUV market.

        • 0 avatar
          highdesertcat

          Steve203, it doesn’t always equate that way in the real world. On the Jeep site, yeah, but not in the real world.

          A friend I know from church in NM when I still lived there bought for his wife a 4-banger Cherokee with a lot of goodies on it a few years back.

          He and his wife “fell out of love” with that Cherokee primarily because it was woefully underpowered when loaded with traveling gear, and the transmission was as busy as a one-armed wallpaper hanger, even on a flat Interstate.

          So they went to Larry H. Miller CDJR in Albuquerque, NM last year and traded that Cherokee in on a 2019 Jeep Grand Cherokee Laredo E 4×4 V6.

          They took a terrible beating on the trade-in value for that Cherokee, but the Grand Cherokee went for almost $3K off MSRP BEFORE the trade.

          Two happy campers now. Had lunch with them at Ft Bliss last week when they were on a shopping trip to El Paso, TX.

          But these changes to Fiatsler’s line-up could just be an adjustment to meet the global automotive future head-on.

          Like out with the old. In with the new: EVs and Hybrids that is.

  • avatar

    I suggest Nissan avoid the dramatic cuts that GM made. Those cuts have taken GM from 1st to fifth place in international sales in just a decade. Don’t go from being a powerhouse to a minnow like GM.

  • avatar
    Fleuger99

    As other’s have said, definitely past their 80’s and 90’s highs with interesting and quality products. Since then it’s been a slow decline. No loss if they crash and burn, excuse the pun :)

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