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Nissan execs sound the alarm on an increasingly dire situation

James Ochoa
4 min read

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After posting net losses earlier this month, Nissan CEO Makoto Uchida said the "extremely tough situation" will force some bold restructuring moves.

In addition to downgrades to its full-year sales and operating outlooks, it set out to save $3 billion by drastically reducing its Mitsubishi share and cutting 9,000 from its global headcount of over 133,000 employees.

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At its news conference, Nissan's Chief Monozukuri Officer (Head of Manufacturing) Hideyuki Sakamoto said that the controversial move will allow its factories to run more efficiently and save money.

“Globally, we currently have 25 vehicle production lines. Our current plan is to reduce the operational maximum capacity of these 25 lines by 20 percent,” Sakamoto said. “One specific method for this is to change the line speed and shift patterns, thereby increasing the efficiency of operational personnel.”

Makoto Uchida, president, and CEO of Japanese automaker Nissan, is facing a severe financial challenge.<p>RICHARD A&period; BROOKS&sol;Getty Images</p>
Makoto Uchida, president, and CEO of Japanese automaker Nissan, is facing a severe financial challenge.

RICHARD A. BROOKS/Getty Images

Nissan execs ring alarm bells

According to a new report by the Financial Times, unnamed senior officials near Nissan note that the automaker is beginning to exist on borrowed time as it seeks an anchor investor to get it through the year.

“We have 12 or 14 months to survive,” the senior official told FT. "This is going to be tough. And in the end, we need Japan and the US to be generating cash."

Related: Nissan CEO delivers tough-luck news to workers

This crisis comes as Renault is selling its significant stake in Nissan. Previously, the French automaker owned up to 46% of Nissan, but its share has dwindled to under 36%.

The sources who spoke with the FT noted that the company is looking for a new long-term investor, such as a bank or large insurance group, to replace some of Renault's equity holdings.

Earlier this month, Nissan's CEO's drastic moves attracted the Singapore-based activist investment group Effissimo Capital Management and the Hong Kong-based Oasis Management Group to take their own stakes in Nissan.

These firms are touted as secretive players known for shaking up major Japanese corporations. Previously, Oasis led a push at Nintendo to make mobile games, which led to the success of the popular app Pokémon Go — from which it raked in tens of millions as a result, as per the Wall Street Journal. The former, Effisimo, made close to $768 million after its very proactive investment in Toshiba led to a buyout in 2023.

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