Nissan Considers Slashing 20,000 Jobs Worldwide Amid Global Downturn

Nissan Motor Co. (NSANY) is weighing the option to slash more than 20,000 from its global workforce, with many of the job cuts centered in Europe and developing countries, reported Kyodo News. The proposed cuts are part of a restructuring plan due to slumping global auto sales amid the COVID-19 pandemic, which resulted in economic turmoil and lockdowns across the world.

Reuters says the announcement of a new medium-term management plan, which would include job cuts and output adjustments, could come as early as next week. Sales volume at Japan's third-largest automaker has been in a downward trajectory for the past three years, and virus-related shutdowns in key markets collapsed sales in 1H20, forcing the company to now consider restructuring and shrink its footprint. 

Last month, several sources told Reuters that Nissan's proposed "massive restructuring" calls for an annual reduction in production output: 

"For years, Nissan was looking for annual sales volumes around 7-8 million vehicles. The company has never managed to sell much more than 5 million or so," one source told Reuters. "The company can no longer consider this sort of wishful thinking. The resizing issue is really being taken into account, it has a lot of consequences on operations for 2020-2022."

Nissan's plan for restructuring would last through March 2023. The spread of the virus has already led to the suspension of domestic and overseas plants, with plunging sales in key markets, including North America, Europe, and China. 

We recently noted that a massive roll-on/roll-off cargo ship carrying 2,000 Nissan SUVs was denied entry to the port of Los Angeles because of the glut of vehicles that sits at the port and surrounding areas. 

"The port was full and the glut is indicative of just how the industry has collapsed in the U.S." 

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