The car industry as a whole may be ailing – but Nissan’s prognosis is particularly dire, the kind you measure in months, not years.
Sluggish sales – mainly in North America – have been disastrous for the Japanese automaker. In response, dealers are selling cars at a loss and production has been slashed by 20%. More recently, the company cut 9,000 jobs and sold a third of its stake in Mitsubishi.
The Japanese automaker also plans to cut production at its plants in Canton, Mississippi, and Smyrna, Tennessee — which together employ some 13,000 workers – by 100,000 cars.
But all of this may be too little, too late.
On paper, at least, it doesn’t look good. Nissan’s operating profit dropped 85% in the third quarter, with the company recording a net loss of 9.3 billion Yen ($60.1 million at today’s exchange rate). On November 7, the company posted a consolidated operating profit for the six months ending in September down over 90% compared with the same period last year.
“We have 12 to 14 months to survive,” a senior official close to Nissan recently told the Financial Times. “This is going to be tough. And in the end, we need Japan and the U.S. to be generating cash,” he said.
Unfortunately, consumers in those countries are simply not buying. And increased competition from China isn’t helping. Read the full story from The Blaze
