Nissan’s Radical Overhaul Will Slash Platforms And Speed Up Development

Desperate times call for desperate measures. This is the position Nissan finds itself in after reporting record financial losses and choosing not to issue an operating profit forecast for the year ending March 2026. The struggling automaker plans to cut 20,000 jobs between the 2024 and 2027 fiscal years, close several factories, and reduce the number of vehicle platforms it uses. If the so-called Re:Nissan recovery plan doesn’t succeed, Nissan as we know it could cease to exist.

Read: Nissan’s Job Cuts Surge To 20,000 As Ex-CEO Predicts Collapse

Announced during Nissan’s latest quarterly earnings report, the plan is being led by new president and CEO Ivan Espinosa. After reporting a net loss of ¥670.9 billion (approximately $4.5 billion) for the fiscal year ending March 2025, Nissan is aiming for total cost savings of ¥500 billion (around $3.39 billion) compared to fiscal year 2024. The automaker hopes this will be enough to return to profitability and generate positive cash flow by fiscal year 2026.

Cutting Costs, Slashing Jobs, and Fewer Platforms

The cost-saving measures are sweeping and will target several areas of the business. In addition to cutting 20,000 jobs across its global network, spanning direct, indirect, and contractual roles, Nissan is overhauling its development processes. The company aims to reduce its workforce’s average cost per hour by 20% and cut parts complexity by 70%.

Additionally, the Japanese automaker plans to reduce the number of platforms it uses from 13 to 7 by fiscal year 2035. It also aims to shorten the development lead time for upcoming models to 37 months, with the goal of cutting it further to just 30 months for future models. Among these new Nissans are the next-generation Skyline, a new C-segment global SUV, and a compact SUV from Infiniti.

Nissan will also close seven of its 17 production plants by fiscal year 2027 and has scrapped plans for a lithium-iron phosphate battery plant in Kyushu, Japan. The changes don’t stop there. The company is temporarily pausing advanced and post-FY26 product activities and reallocating 3,000 employees to focus on cost-reduction initiatives. Nissan is also introducing a new governance model, including a dedicated office staffed by 300 experts tasked solely with making cost-related decisions.

A Focused Product Strategy

In terms of product, Nissan wants to tailor its strategy to the specific needs of different markets. The company is placing a heavy focus on the US, Japan, China, Europe, the Middle East, and Mexico. In the US, the focus will be on hybrids and revamping the Infiniti brand.

Meanwhile, in China, Nissan plans to push forward with NEVs (new energy vehicles). Over in Europe, the brand will target B and C-segment SUVs, while in the Middle East, large SUVs are the priority, and yes, there’s even a chance they’ll import Chinese-made vehicles.

“In the face of challenging FY24 performance and rising variable costs, compounded by an uncertain environment, we must prioritize self-improvement with greater urgency and speed, aiming for profitability that relies less on volume,” Espinosa explained.

“As new management, we are taking a prudent approach to reassess our targets and actively seek every possible opportunity to implement and ensure a robust recovery. Re:Nissan is an action-based recovery plan clearly outlines what we need to do now. All employees are committed to working together as a team to implement this plan, with the goal of returning to profitability by fiscal year 2026.”