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More U.S. Cutbacks at Nissan

Nissan is trimming white-collar staffers in the U.S. again after its sales in the region plunged 10% last year.
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Nissan is trimming white-collar staffers in the U.S. again after its sales in the region plunged 10% last year.

This time, the carmaker says it will close two of its eight regional sales offices (in the Northwest and western mountain states) and offer a second round of buyouts, this time for staffers who are at least 52 years old.

Round Two

Nissan began the belt-tightening last summer after reporting that its overall net profit dropped 57% to $2.9 billion in the fiscal year ended March 31, then plummeted 95% for the three-month period that followed. The company says a turnaround will take three years.

On a global level, Nissan plans to prune its product lineup, shed 600,000 units of annual production capacity and eliminate 12,500 jobs in the next two years. The cutbacks will reverse the expansionary strategy of former Chairman Carlos Ghosn, who was booted out of the company at the end of 2018 over charges of financial wrongdoing.

At least 1,400 of those positions are in the U.S., where Nissan’ employs about 20,000 people. The carmaker has already conducted one round of reductions. It comprised buyout offers, a 50% cut in travel budgets, layoffs at a plant in Mississippi and a two-day unpaid vacation for everyone in its U.S. offices.

More Spring Cleaning

Nissan also it trying to reduce its reliance on its U.S. fleet business, which pumps up volume statistics but delivers skimpy profits compared with one-by-one retail sales.

Finally, Nissan is joining the growing parade of companies that have stopped posting monthly sales data in favor of quarterly reports.

Monthly results can be warped by bad weather, plant disruptions and other anomalies. But waiting for quarterly posts also slows the ability to spot trends, for good or bad.

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