Nissan Temporarily Shutters Global Headquarters, Japanese Factories
Nissan said Tuesday that it plans to temporarily shut down its global headquarters and several factories in Japan to help curtail the spread of the novel coronavirus. While Japanese automakers are legally allowed to operate within the country (with conditions), most have instituted some amount of health countermeasures independently. The nation has also formed a joint council for automakers and component suppliers to work with the government in maintaining supply chains while avoiding future contagion risks.
Despite the level of precautions taken, the country’s automakers are still estimated to lose at least $1.6 billion as the pandemic suppresses demand around the world. Nissan, which issued profit warnings in 2019, went into 2020 expecting to eliminate thousands of positions so it could begin amassing $4.4 billion in savings by 2023. Marketing budgets and product lineups would also need to be rejiggered dramatically to assure profitability moving forward. With the coronavirus further complicating the company’s strategy, May’s idling could be about more than just containing the coronavirus.
Most Japanese automakers, including Nissan, have already stalled production due to supply chain issues and an overwhelming lack of customers. According to Reuters, Nissan said that 15,000 employees at its headquarters in Yokohama and main R&D center in the nearby Atsugi, Kanagawa Prefecture would be required to take leave for 16 days from next Monday through Japan’s “Golden Week” holiday — starting on May 4th.
Its headquarters would be closed to all but essential workers, a Nissan spokeswoman said, adding that those affected would receive “the majority” of their full salaries during the period.
The spokeswoman said the measures were aimed at keeping more than 90 percent of its employees away from its offices, up from 80 percent at the moment.
Like many of its global rivals, Nissan has also shuttered most of its global production facilities in compliance with “shelter at home” directives to contain the spread of the virus.
Admirable. But Nissan is also expected to make huge production cuts in the years ahead — becoming a smaller, more stable company. That’s the hope, anyway. Analysts were predicting annual targets being cut by as much as 1 million units before the pandemic. The manufacturer is expected to released a revised plan (one that accounts for the coronavirus) next month, with most under the impression that intensified downsizing will be necessary. Nissan’s not alone in this, however. Rivals in better financial health have said they’re expecting 2020 production levels to be off target by as much as 50 percent.
By idling its headquarters, the automaker can probably save itself a bit of money as it also helps enact some useful social distancing measures. Still, it’s hardly an ideal scenario for the company. Many of non-essential workers will continue drawing from funds that can’t be replenished until things improve. But it doesn’t make much sense to ask them to come in when there’s precious little going on, and having assembly lines running when nobody’s buying automobiles seems unwise.
Nissan has already stalled production at its Tochigi plant — which produces Infiniti models — for the rest of this month and intends to continue doing so through much of May. Meanwhile, Nissan Motor Kyushu — which manufactures exported Rogue models in Fukuoka Prefecture — will continue operating on limited shifts before a brief 4-day closure next month.
Japanese automakers have already enacted plant closures in the United States and, more recently, have started scaling back production in their home country. Toyota slowed output to keep pace with demand and Honda said it will probably suspend production at several facilities to address supply chain problems with formerly shuttered Chinese factories that reopened on a limited basis.
Schmitt trigger on Apr 22, 2020
When I lived in Mexico in the 1980s the company I worked for had a fleet of those small Nissan pickups. https://imganuncios.mitula.net/nissan_estaquita_redilas_2002_63_excelentes_100942873099908206.jpg Absolutely no frills, but reliable as hell. Most so that as company vehicles they never had the personal tender love that a private vehicle has. Myself, I also drove what in Mexico the model was labeled a Nissan Tsuru. Again, ancient design, absolutely no frills, but it never failed. This thing was so reliable and easy to repair that became the vehicle of choice for Mexico City's enormous cab driver fleet. https://cs1.gtaall.com/screenshots/4dc09/2017-03/original/b7fa41838a17dd79a626b740b69ee22621de2488/389411-enb-2017-03-13-01-21-53-62.jpg
Latest Car ReviewsRead more
Latest Product ReviewsRead more
- Syke Is it possible to switch the pure EV drive on and off? Given the wonderful throttle response of an EV, I could see the desirability of this for a serious off-roader. Run straight ICE to get to your off-roading site, switch over the EV drive during the off-road section, then back to ICE for the road trip back home.
- ToolGuy Historical Perspective Moment:• First-gen Bronco debuted in MY1966• OJ Simpson Bronco chase was in 1994• 1966 to 1994 = 28 years• 1994 to now = 28 yearsFeel old yet?
- Ronnie Schreiber From where is all that electricity needed to power an EV transportation system going to come? Ironically, the only EV evangelist that I know of who even mentions the fragile nature of our electrical grid is Elon Musk. None of the politicians pushing EVs go anywhere near it, well, unless they are advocating for unreliable renewables like wind and solar.
- FreedMike I just don’t see the market here - I think about 1.2% of Jeep drivers are going to be sold on the fuel cost savings here. And the fuel cost savings are pretty minimal, per the EPA: https://www.fueleconomy.gov/feg/PowerSearch.do?action=noform&path=1&year1=2022&year2=2022&make=Jeep&baseModel=Wrangler&srchtyp=ymm&pageno=1&rowLimit=50Annual fuel costs for this vehicle are $2200 and $2750 for the equivalent base turbo-four model. I don’t get it.
- FreedMike How about the “Aztek” package? Wait, this car already has that…Said it before and I’ll say it again: they need to restyle the hind end on this car, stat.