The struggling carmaker is urgently cutting costs as it looks to turn things around. Nissan is offering buyouts to US workers at its Canton, Mississippi, plant, citing it as a “crucial” part of its comeback plan.
Nissan offers buyouts for US workers at its Canton plant
Nissan has been in the spotlight over the past few weeks for all the wrong reasons. It began earlier this month, following the company’s announcement that it was abandoning plans to build a new EV battery plant in Japan.
The facility was set to produce lower-cost LFP batteries, which have been key to BYD and other Chinese EV brands’ rapid rise in the global auto industry. With an annual production capacity of up to 5 GWh, the plant was expected to slash EV battery costs by 20% to 30%.
Facing slumping sales, lower profits, and more competition, Nissan launched its new recovery plan, dubbed “Re:Nissan,” earlier this month.
The comeback strategy involves cutting 20,000 jobs, or around 15% of its global workforce, by 2027. Nissan is also closing several plants to slash costs by 250 billion yen as it aims to return to profitability by fiscal year 2026.
According to an internal email, viewed by Reuters, Nissan is offering buyouts for US workers at its Canton plant. The email also stated that merit-based pay increases are suspended globally.
Christian Meunier, Nissan America’s chairman, said the buyouts are “crucial for Nissan’s comeback” in the US, its most important market.
“While substantial efforts have been made in the US to help right-size Nissan, we need to take additional, limited, strategic action here at a local level,” Meunier said in an email.
Nissan announced a voluntary separation program for a select number of US salaried employees. Since the plan is still ongoing, Nissan didn’t provide any further details.
On Wednesday, a separate report from Bloomberg News claimed that Nissan is looking to raise over 1 trillion yen ($6.9 billion) with the help of the UK government to repay a massive loan due next year.
Nissan invested $500 million to upgrade its Canton plant for electric vehicle (EV) production in the US. Although it initially planned to begin building EVs in the US this year, Nissan delayed production until at least 2028.
Later this year, Nissan will launch the upgraded LEAF, now with a longer driving range, an NACS charging port, and a more SUV-like design. It will be one of ten new Nissan or Infiniti models to launch by 2027.
Electrek’s Take
As Electrek reported yesterday, Nissan’s comeback plan hinges on its upgraded e-Power technology. The only issue is that the system is designed for hybrids.
Nissan is following in Toyota and Honda’s footsteps by advancing new hybrid and plug-in hybrid tech, but the company is already two steps behind.
Doubling down on hybrids and PHEVs while delaying more EV projects will likely only set Nissan up for failure over the next few years.
The Japanese automaker is already losing market share in some of its biggest markets, like China and Southeast Asia.
Can Nissan turn things around in the US, its most important market? Or, will it continue to fall out of favor with lower-cost, more advanced EVs on the way from brands like Rivian and Lucid? Let us know your thoughts in the comments.
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