Nissan Motor Co. is facing one of its most challenging periods, reporting a $2 billion annual loss for 2024, the second-largest since 1999, and announcing a 15% workforce reduction.
These setbacks are compounded by a 6% drop in Japanese auto production, the steepest decline since 2020. The company attributes its financial struggles to U.S. tariffs, which have increased costs for its exported vehicles, and a slowdown in global demand for its models.
The U.S. market, a key revenue source for Nissan, has been particularly hard-hit by the 25% tariffs on cars and parts, forcing the company to reassess its production strategy.
Plans to shift some manufacturing to U.S. facilities are underway, but the transition is costly and complex. Additionally, Nissan’s EV lineup has struggled to compete with rivals like Tesla and BYD, contributing to a 10% drop in global sales.
The workforce cuts, affecting thousands of employees, aim to streamline operations but have sparked concerns about long-term innovation capacity.
Industry analysts warn that Nissan’s recovery hinges on revitalizing its product portfolio and strengthening its EV offerings. The company is exploring partnerships to share R&D costs and is investing in next-generation battery technologies.
However, with Japan’s auto sector facing broader economic pressures, Nissan’s path to profitability remains uncertain.
Consumers may see reduced model availability in the near term, while stakeholders hope for strategic pivots to restore Nissan’s competitive edge in a rapidly evolving market.
