Nissan to slash 12,500 jobs to cut costs, achieve turnaround

A pedestrian walks past a Nissan car gallery Thursday, July 25, 2019, in Tokyo. Nissan says it will slash 12,500 jobs, about 9% of its global workforce, to cut costs, achieve turnaround toward growth. (AP Photo/Eugene Hoshiko)
Nissan CEO Hiroto Saikawa walks away from the podium after a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)
Nissan CEO Hiroto Saikawa speaks during a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)
Nissan CEO Hiroto Saikawa speaks during a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)
Nissan CEO Hiroto Saikawa listens to questions from the media during a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)
Nissan CEO Hiroto Saikawa pauses for a moment during a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)
Nissan CEO Hiroto Saikawa speaks during a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)
Nissan logo is seen at a Nissan car gallery Thursday, July 25, 2019, in Tokyo. Nissan says it will slash 12,500 jobs, about 9% of its global workforce, to cut costs, achieve turnaround toward growth. (AP Photo/Eugene Hoshiko)
Nissan CEO Hiroto Saikawa speaks during a news conference at the global headquarters Thursday, July 25, 2019, in Yokohama, west of Tokyo. Nissan says it is slashing 12,500 jobs or about 9% of its global workforce in an effort to cut costs and achieve a turnaround, as its profits tumble. (AP Photo/Jae C. Hong)

TOKYO — Nissan is slashing 12,500 jobs or about 9% of its global workforce to cut costs and achieve a turnaround amid tumbling profits, the Japanese automaker said Thursday.

Nissan Motor Co. also said it will cut global production capacity by 10% and reduce model lineups by at least 10% by the end of fiscal 2022.

Nissan Chief Executive Hiroto Saikawa said most of the jobs cut will be auto plant workers. He did not give a regional breakdown, but said the job cuts were needed to cut global production capacity and cut costs.

A company presentation posted on Nissan's website said more than 6,400 jobs would be eliminated in eight unspecified locations by the end of this fiscal year. Another 6,100 will come by fiscal 2022, it said.

Saikawa told reporters at the automaker's Yokohama headquarters that sales are expected to begin to recover thanks to those measures. Some of the efforts have already begun, he said.

The Japanese automaker is struggling to fix its brand image and get growth going again following the arrest of former Chairman Carlos Ghosn. Ghosn says he is innocent. He is awaiting trial in Japan on various financial misconduct allegations.

"Our situation right now is extremely severe," Saikawa said, noting attractive models were coming with technology like artificial intelligence and zero emissions to boost sales.

"Our stance to lead the industry is unchanging."

In April-June, Nissan's profit nose-dived to 6.4 billion yen ($59 million), down drastically from 115.8 billion yen the same quarter in the previous fiscal year. Quarterly sales shrank 13% to 2.37 trillion yen ($22 billion).

For the fiscal year that ended in March, annual profit dropped to less than half of what Nissan earned in the previous year, at 319.1 billion yen ($2.9 billion), the worst showing since the global financial crisis a decade ago.

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