Japan's third-biggest automaker, Nissan Motor Co, has announced that it will cut another 500 jobs in Japan and reduce production as the demand for cars have plummeted due to the global economic crisis.

The company plans to reduce the number of domestic temporary staff by 500 people who are on temporary contracts. Nissan will no longer have any contract workers at its factories in Japan after this cut, said a company spokeswoman.

In the recent boom, companies had hired a growing number of contract workers, who do not have the same social protections as regular employees. Temporary workers have borne the brunt of Japan's economic slowdown.

Nissan plans to reduce output by 78,000 cars in the first quarter of next year by cutting shifts or operating days at plants.

Nissan said it had decided to "manage inventory levels and ensure a balanced production supply in response to continued declines in global vehicle sales.''

Nissan had announced in October that it was axing 3,500 jobs worldwide and cut its full-year forecasts by two-thirds as the global economic crisis shakes the auto industry.

Nissan's profits for the first half slumped by 40.5 percent to 126.34 billion yen (1.3 billion dollars) on a sharp slowdown in the key US market and the soaring value of the yen.

Nissan now expects a net profit of 160 billion yen for the full financial year to March, down from 482.26 billion a year earlier and well short of an earlier forecast of 340 billion yen.

Nissan in recent months said it would cut production by 137,000 vehicles, mostly luxury cars and sports utility vehicles, as export to the United States have fallen with slowdown in demand.