Nissan announces job cuts in Japan as market slumps

25 Apr 2007

Mumbai: Japan''s third-biggest automaker, Nissan Motor Co., has announced a voluntary retirement programme for its employees in Japan, to cut up to 1,500 blue and white-collar jobs amid a shrinking domestic market.

The scheme, to start in June, will be open to workers aged 45 and above in non-managerial posts, a Nissan spokesman said.

Nissan has seen its domestic sales of non-mini vehicles plummet in the face of tough competition in a shrinking market, forcing the company to announce a cutback in production at two domestic car plants from April to June.

The company also closed down one of three lines at another factory, in southern Japan, last September due to slow sales of the Teana high-end sedan

Nissan, held 44 per cent by Renault SA of France, launched few new models last year.

It also recently cut jobs in the US, where its sales slumped last year, where it said 775 workers at two Tennessee plants had accepted voluntary retirement last month.

Chief executive Carlos Ghosn had promised last month to draw up additional measures to help Nissan meet its targets under a three-year plan, but the company has missed the targets.

Nissan slashed its annual profit forecast after seeing a 22 per cent slump in earnings in the October-December quarter.

The backtracking forced Ghosn, once credited for saving Nissan from bankruptcy, to declare his company in a "performance crisis."

Earlier this month, Nissan said it may miss a key sales target it aimed to hit next fiscal year, in another blow to Ghosn''s comeback plans.

Nissan is aiming to sell 4.2 million vehicles globally in the fiscal year ending March 2009 as part of a three-year revival plan.

But weak performance last year, blamed on a dearth of new models in North America and sluggish sales in Japan, may mean it might take longer to meet the target, said a Nissan spokeswoman who spoke on condition of anonymity.

Nissan is due to announce full-year results and updates to the "Nissan Value-up" business plan on April 26.