New Delhi. Japan’s third-largest automobile company Nissan Motor Corp has decided to fundamentally change its global operations. The company has announced layoffs of 9,000 employees and a 20 percent reduction in production capacity to regain its lost share of the electric and hybrid vehicle market. CEO Makoto Uchida will also receive a 50 percent reduction in salary.

Nissan suffered a loss of 9.3 billion yen (about $60 million) in the September quarter, while the company made a profit of 190.7 billion yen in the year-ago quarter. The company said these restructuring measures were taken after a 94% decline in sales in the first half of the year.

Will reduce stake in this company
Nissan has burned through 448.3 billion euros (about $2.9 billion) in cash in recent months and now plans to sell some of its shares in Mitsubishi Motors Corp. for sale. The company’s operating profit fell 70% short of its forecast, while its revenue forecast was also cut by more than 9%.

Why did the company’s problems increase?
Nissan President and CEO Makoto Uchida said that the purpose of these changes is to make the company more flexible and able to respond to rapidly changing market trends. He said that in addition to external challenges, the company was also struggling with its own internal problems, including the growing presence of local companies in China and overly ambitious sales targets.

In China, companies like BYD have benefited from increasing demand for electric vehicles, while in America the popularity of hybrid vehicles is increasing. As part of these changes, Nissan will increase investment in its electric vehicle lineup in China and expand hybrid vehicles in the United States. In addition, the company has decided to make production more efficient and reduce costs by leveraging its partnership with Honda.

Through these major changes, Nissan aims to become more competitive in the global automotive market. However, Uchida admitted that the path forward is not easy as the automotive industry is undergoing rapid change.

Tags: car news