Nissan outlines comprehensive turnaround measures
To secure sustainable profitability
Nissan Motor Corporation has unveiled an update on its comprehensive turnaround strategy, which aims to reshape the company into a more agile, cost-efficient, and competitive business.
To secure sustainable profitability, Nissan focuses on various cost-saving initiatives, restructuring its manufacturing operations, and exploring new partnerships. The company also shared targets for fiscal year 2026, setting clear benchmarks to support its long-term vision.
Nissan President and CEO Makoto Uchida said: “Nissan is fully committed to its turnaround actions, aiming to reduce costs by around 400 billion yen. We are dedicated to achieving a more efficient cost structure while driving top-line growth through enhanced competitive products catering to our customers’ diverse needs. We are executing our turnaround—centred on efficiency and growth—with pace and purpose.”
The company has outlined a strategic plan to optimise its cost structure, targeting total cost reductions of approximately 400 billion yen by fiscal year 2026. This includes a significant decrease in Nissan’s break-even point from 3.1 million units to 2.5 million units, positioning the company for a stable operating margin of 4%.
Of the 400 billion yen target, Nissan aims to save over 300 billion yen in fixed costs. To streamline operations, Nissan will also reduce its global indirect workforce by 2,500 employees through voluntary separations, hiring freezes, and operational streamlining.
Additional savings are expected through expanding shared service centres and cutting fixed marketing expenses. Furthermore, Nissan will lower labour costs by shifting responsibilities and consolidating production lines.
Nissan is implementing significant adjustments to its global manufacturing operations as part of its plan. The company will reduce production capacity by 20%, focusing on increasing plant utilisation rates. In fiscal year 2026, Nissan aims to improve its plant utilisation from 70% to 85%, achieving a reduction in global production capacity from 5 million units to 4 million units. Notably, Nissan has already reduced its capacity in China from 1.5 million units to 1 million.
A key element of this manufacturing restructuring includes consolidating production lines across several key plants. Starting in Q1 FY25, Nissan will implement changes at its Smyrna and Canton plants in the U.S. and its facility in Thailand. As part of the ongoing rightsizing effort, these changes will result in 6,500 fewer employees across vehicle and powertrain plants by fiscal year 2026.
To support top-line growth, Nissan has prioritised the launch of differentiated products that cater to regional and customer-specific needs. The company recently refreshed its model lineup, introducing popular models such as the Qashqai, Juke, Kicks, Armada, and Murano. Looking ahead, Nissan will expand its electric vehicle (EV) offerings, including new plug-in hybrid models and an enhanced line of zero-emission vehicles.
In addition to its new EVs, Nissan plans to introduce innovative third-generation e-POWER models, significantly improving fuel efficiency and reducing costs. The third-generation models will offer a 20% improvement in fuel efficiency and a 20% cost reduction compared to the first-generation, positioning Nissan to remain competitive in key markets such as Europe and the U.S.
Nissan will also expand its intelligent vehicle technologies to strengthen its product portfolio further. Upcoming models, slated for launch by fiscal year 2026, will feature advanced driver assistance systems and unique intelligent cockpits, with plans to introduce autonomous driving capabilities by fiscal year 2027.
Nissan is also focused on streamlining its organisational structure. The company will reduce top management positions by 20% and simplify decision-making processes to ensure faster response times. A single-layer management framework will create opportunities for the next generation of leaders within the company.
In its search for future growth, Nissan has initiated a strategic review to actively explore new partnership opportunities that could significantly enhance its corporate value. The company mainly seeks to collaborate with its Alliance partners and other key industry players.
Nissan’s turnaround efforts are underway, and the company is on track to meet its ambitious goals. The initiatives outlined in today’s update are just the beginning of a broader, long-term strategy designed to strengthen Nissan’s position in the global automotive market. The company intends to provide further updates on its progress in the coming months as it works toward building a leaner, more resilient business capable of adapting to the rapidly evolving automotive landscape.
By focusing on cost-efficiency, product innovation, and strategic partnerships, Nissan is determined to set the stage for sustainable growth and increased profitability in the years ahead.
Image: Nissan’s turnaround efforts are underway, and the company is on track to meet its ambitious goals. Credit: Nissan
