Breaking: Nissan announces major cuts, but Sunderland plant safe
Nissan Sunderland
Nissan will maintain Sunderland as European production hub despite closing factories around the world, focus on larger models and sports cars
Nissan has committed to the future of its Sunderland factory despite a recovery plan to reduce production capacity by 20% globally.
The Japanese firm has today announced its three year transformation plan, dubbed Nissan Next, during which it seeks to substantially reduce fixed costs and remove redundant assets. As part of the plan it will close its Barcelona factory, resulting in the loss of about 2,800 jobs.
The decision comes after Nissan reported its first annual operating loss for 11 years for the 2019 financial year. The company ended the year with a net loss of 671.2bn yen and an operating loss of 40.5bn yen. Sales decreased 10.6% globally from 5.52m units to 4.93m, with a slowdown in North American and Europe primarily to blame.
Nissan will reduce its production capacity by 20% over the next three years, also closing a plant in Indonesia. However, it intends to maintain Sunderland as a production base for Europe and “leverage the Alliance”. Although not confirmed, recent reports suggest the company plans to bring production of Renault models - namely the Kadjar and Captur SUVs - to the English factory.
Nissan will also focus on streamlining its product lineup globally. President Makoto Uchida admits that , along with factors such as fluctuating currencies, “the sales decrease continues to weigh on our profit as we suffer from an ageing portfolio and limit profit distribution from our efforts to normalise sales”.
As a result the company will reduce its number of global models by 20% in three years - down from 69 to less than 55. Resources will be reallocated to globally competitive models, with the core segments named as the C-segment (Qashqai), D segment (X-Trail), EVs and sports cars. It will also shorten its product life cycle to result in an average portfolio age of less than four years.
The brand will focus its growth strategy on its most successful markets: Japan, China and North America. It will then sustain its business in Europe, Latin American and Asian markets.
*READ MORE*
*Renault-Nissan-Alliance members to massively increase technology sharing*
*Renault in talks to build SUVs at Nissan Sunderland plant*
*Nissan gives Sunderland plant £400m boost to build new Qashqai*