Nissan has made plans for a major round of cost-cutting ahead of a meeting on Monday. Renault Nissan CEO Carlos Ghosn is due to meet employees in Japan to address the global collapse in the market for new cars, and what Nissan must do to respond.
Virtually everything is under consideration for the knife, several sources indicate, except for primary product development programs and Nissan’s electric vehicle plans, in which Ghosn takes a particular interest.
Like other global manufacturers, Nissan has been slammed by the slump in the US, its biggest international market. But it doesn’t help that the company’s home market also is suffering the worst drop in new car sales for 35 years. Nissan’s monthly domestic sales fell 31 per cent to 30,786 vehicles in January.
It’s almost 10 years since the Renault/Nissan Alliance was formed, with Renault taking a controlling stake in its Japanese rival, and putting Ghosn to work managing a turnaround. But after showing strong signs of success, earlier in the decade, Nissan has been suffering a number of problems lately.
In the US its big push into the light truck market, with vehicles such as the full-size Titan pickup, has fallen well short of expectations. In an attempt to cut costs, Nissan will soon end production of the Titan, sourcing a replacement from Chrysler, based on the newly redesigned Ram.
Meanwhile, in an effort to make better use of its factory capacity, Nissan is producing a small car for Chrysler’s Latin American dealer network. Last month, Nissan announced it would restructure operations in the US, including the cloasure of a design centre in Michigan.
Preliminary indications suggest that the Monday announcement – coinciding with the release of dismal third-quarter earnings – will demand far greater cuts, and most likely at Nissan operations around the world.