Nissan will close seven factories and lay off 20,000 people due to its worst loss in 25 years

Nissan Motor Company has recorded its worst loss in about 25 years and announced that it will close seven factories and lay off 20,000 employees to deal with the crisis.

Bloomberg reported that Nissan Motor Company released its financial report on Tuesday (May 13), showing that the company's net loss for the fiscal year from April last year to March this year reached 670.9 billion yen, setting the worst record since 1999. The company has not released its operating profit forecast for the fiscal years 2025 to 2026.

To accelerate the restructuring process, Nissan plans to reduce its 17 factories to 10 by the fiscal year 2027 and cut its annual production capacity from 3.5 million vehicles last year to 2.5 million vehicles.

In addition, the company also confirmed that it will lay off 20,000 employees, including the 9,000 positions previously announced, in order to save approximately 500 billion yen in costs.

This troubled Japanese automaker has lost competitiveness in the two major markets of the United States and China due to the aging of its models and faces numerous difficulties in business transformation. At the beginning of the year, after the merger talks with Honda broke down, Nissan has announced large-scale layoffs, capacity cuts and the replacement of several senior executives, urgently seeking a new way out.

The unpredictable trade policies of the US government are also continuously impacting the global automotive industry. Stellantis and Mercedes-Benz have cancelled their earnings forecasts, and major Japanese automakers have also issued warnings one after another. Toyota is expected to suffer an operating profit loss of 180 billion yen within two months. Mazda has even suspended its full-year performance guidance and expects to lose 10 billion yen in April alone.