News On Japan

Three Factors Behind Nissan’s Decline

TOKYO, Nov 18 (News On Japan) - Nissan has announced a major restructuring plan involving the elimination of 9,000 jobs worldwide, triggered by worsening business performance.

This move has drawn significant attention from activist investors, often referred to as "shareholder activists," signaling increased pressure on the automaker to overhaul its operations. Additionally, the broader Japanese automotive industry is bracing for potential shifts under the new Trump administration, with implications for trade policies that may favor Toyota while disadvantaging Honda.

Nissan’s announcement on November 7th highlighted plans to cut global production capacity by 20%, a response to declining profitability in key markets like the United States and China. The company cited increased promotional costs in U.S. dealerships and intensified competition in China as key challenges. Nissan also revised its global sales forecast downward by 250,000 units, now projecting a total of 3.4 million vehicles for the fiscal year. Its operating profit forecast was drastically reduced from 500 billion yen to 150 billion yen, falling far below market expectations.

On November 12th, Bloomberg reported that a fund linked to the former Murakami Fund had acquired a 2.5% stake in Nissan, igniting speculation about a potential push for changes in corporate governance. The focus is on Nissan’s subsidiary, Nissan Shatai, which some argue should be fully integrated into the parent company.

Industry analysts suggest that Nissan’s struggles are rooted in slow adaptation to market trends, particularly in electric vehicles (EVs) and hybrids. While competitors like Toyota and Honda have capitalized on these segments, Nissan has lagged in introducing competitive models, with some new technologies still years away from market readiness.

Looking ahead, challenges remain significant for Nissan, with the specter of trade policy changes under Trump’s administration adding to the uncertainty. While companies with established production bases in North America, like Toyota, may find advantages, those relying heavily on imports from Mexico or China could face higher costs.

As activist investors push for restructuring, Nissan faces mounting pressure to revitalize its operations amidst a rapidly changing global automotive landscape.

Source: TBS

News On Japan
POPULAR NEWS

The Japanese government has decided to expand its tuition-free high school program this spring. Public high school tuition is now completely free regardless of household income, and starting next academic year, the scope of support for private schools will also be broadened.

Shuri Castle, a symbol of Okinawa's Ryukyu heritage, suffered extensive damage in a devastating fire in October 2019 that destroyed the main hall and many other structures. The cause of the blaze remains unknown.

A deepening labor shortage in Japan’s construction industry is beginning to impact homebuyers, with some experiencing delays of more than six months before construction can even begin due to a lack of available carpenters.

The Imperial Household Agency launched an official YouTube channel on April 1st to introduce the activities of Emperor Naruhito and Empress Masako.

Japan's new fiscal year began on April 1st, with companies across the country holding entrance ceremonies to welcome new employees.

MEDIA CHANNELS
         

MORE Business NEWS

Over 20,000 people attended the Camping Car Show held last month in Osaka over two days, reflecting a growing interest in campers across Japan. What is driving this renewed popularity?

The prototype line for next-generation semiconductors developed by Rapidus is now ready, as a nationwide initiative to boost Japan's chip industry takes a major step forward in Hokkaido.

The Japanese government approved a cabinet ordinance on April 1st to introduce a new pre-screening system for foreign companies investing in Japan. The revised regulation will take effect on May 19th.

The Bank of Japan's March Tankan survey, a key quarterly economic report, showed that business sentiment among large manufacturers has deteriorated for the first time in four quarters.

Tokyo has made it mandatory to install solar panels on newly built houses starting April 1st, as part of its broader effort to halve greenhouse gas emissions by 2030.

The new fiscal year began on April 1st, with companies across the Kansai region holding entrance ceremonies to welcome new employees.

Japan's new fiscal year began on April 1st, with companies across the country holding entrance ceremonies to welcome new employees.

Sukiya, one of Japan's leading beef bowl restaurant chains, announced it will temporarily close nearly all of its stores after an insect was found in a food item served at one of its outlets.