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Nissan to cut 12,500 jobs worldwide Nissan to cut 12,500 jobs worldwide
(32 minutes later)
Japanese car giant Nissan has announced 12,500 job cuts as it attempts to shore up its finances after recent troubles. Japanese car giant Nissan has said it will cut 12,500 jobs around the world, more than double the amount previously announced.
It will reduce its production capacity and the number of models it produces by 10% by the end of 2022, but it did not say where the cuts will fall.It will reduce its production capacity and the number of models it produces by 10% by the end of 2022, but it did not say where the cuts will fall.
The firm also announced a 94.5% fall in net income for the first quarter of 2019. It comes as the firm tries to shore up its finances amid weakening sales.
This is one of the one of the carmaker's worst quarterly performances in a decade. Union sources said they were hopeful Nissan's Sunderland car plant would escape the cuts.
Union sources are hopeful that Nissan's Sunderland car plant will escape the effects of the cuts. In May, it announced job losses of 4,800, which are included in the new total.
Of the 12,500 job cuts, 6,400 have already been implemented at eight locations. On Thursday, the firm announced a 94.5% fall in net profit for the first quarter of 2019 - one of its worst quarterly performances in a decade.
The firm plans to shed another 6,100 jobs between the 2020 and 2022 financial years at six locations. Nissan has been struggling in the US, a key market, where it has been heavily discounting to keep up with sales by rivals.
Nissan continues to struggle in the US, a key market, where it has been heavily discounting to keep up with sales by rivals. It also reported first-quarter sales falls in Europe, Asia and Oceania, Latin America, the Middle East and Africa.
It reported first-quarter sales falls in Europe, Asia and Oceania, Latin America, the Middle East and Africa. The firm is reining in its operations after years of expansion under former chairman Carlos Ghosn, who was ousted last year after being accused of financial crimes.
The carmaker is reining in its operations after years of expansion under former chairman Carlos Ghosn, who was ousted last year after being accused of financial crimes. In a news conference, chief executive Hiroto Saikawa said the job cuts would account for a "big portion" of the savings it was trying to make.
In a news conference, Nissan boss Hiroto Saikawa said the job cuts would account for a "big portion" of the savings it was trying to make. Of the 12,500 job losses, 6,400 have already been implemented at eight locations, he said.
Nissan plans to shed another 6,100 jobs between the 2020 and 2022 financial years at six locations.
He did not specify which models would be targeted for production cuts, but said they would be likely to affect "compact cars and its Datsun range".He did not specify which models would be targeted for production cuts, but said they would be likely to affect "compact cars and its Datsun range".
The cuts will fall on unprofitable products, Mr Saikawa added. The cuts will fall on unprofitable models, Mr Saikawa added.
Nissan's Sunderland plant makes profitable lines and also makes the Leaf electric car. Part of the firm's broader strategy is a focus on electric vehicles. Nissan's Sunderland plant makes profitable lines and also manufactures the Leaf electric car. Part of the firm's broader strategy is a focus on electric vehicles.
However, jobs at the factory are endangered by Brexit uncertainty that is causing foreign-owned firms to question their investments in the UK. However, in February it announced it would build its new X-Trail model in Japan, instead of Sunderland, blaming Brexit uncertainty.
Earlier this year, Nissan said it planned to end the production of two of its Infiniti cars at Sunderland. It also announced it would build its new X-Trail model in Japan, instead of Sunderland. A month later, it said it planned to end the production of two of its Infiniti cars at Sunderland.
AnalysisAnalysis
Theo Leggett, international business correspondentTheo Leggett, international business correspondent
Battered by scandal, and struggling to curb falling sales, Nissan is taking dramatic steps.Battered by scandal, and struggling to curb falling sales, Nissan is taking dramatic steps.
It now plans to cut 12,500 jobs worldwide and close or reduce capacity at up to 14 factories as it tries to reduce excess capacity and cut costs.It now plans to cut 12,500 jobs worldwide and close or reduce capacity at up to 14 factories as it tries to reduce excess capacity and cut costs.
In the three months to the end of June, the company made an operating profit of just £12m ($14m), compared with more than £800m ($1bn) in the same period last year - a decline of 98%.In the three months to the end of June, the company made an operating profit of just £12m ($14m), compared with more than £800m ($1bn) in the same period last year - a decline of 98%.
Sales in the US, one of its biggest markets, have declined sharply, while there have also been concerns in Europe.Sales in the US, one of its biggest markets, have declined sharply, while there have also been concerns in Europe.
Last year, the company's former chairman, Carlos Ghosn, was dismissed, following his arrest in Japan on charges of financial misconduct.Last year, the company's former chairman, Carlos Ghosn, was dismissed, following his arrest in Japan on charges of financial misconduct.
He denies the charges and has blamed a conspiracy among Nissan executives for his downfall.He denies the charges and has blamed a conspiracy among Nissan executives for his downfall.