Kitakyushu, May 10 (News On Japan) - Nissan announced on May 9th that it has withdrawn its plan to build a new electric vehicle battery plant in Kitakyushu City, Fukuoka Prefecture. Executives from the company visited the Fukuoka Prefectural Government to deliver the news directly.
"We had high hopes, which makes this all the more disappointing," said Nissan CEO Makoto Uchida and other senior officials as they informed Governor Hattori and Mayor Takeuchi that the planned construction in the Hibikinada district would no longer go ahead.
The project, which had only just secured a location agreement in January, involved a total investment of around 150 billion yen and was expected to create 500 new jobs. However, facing an extremely tough business environment—including the recent forecast of a record net loss of 750 billion yen for the fiscal year—Nissan has decided to scrap the plan.
Despite the setback, Nissan stated that its key domestic facilities, including Nissan Motor Kyushu and Nissan Shatai, remain among its highest priority global production bases. The company said it will continue making maximum efforts to maintain production at those sites.
Nissan is currently undergoing one of the most turbulent periods in its recent history, marked by severe financial setbacks and sweeping restructuring efforts. For the fiscal year ending March 2025, the company has forecast a record net loss of between 700 billion and 750 billion yen (approximately 4.9 to 5.3 billion dollars). This sharp downturn is largely due to a global impairment charge of 2.6 billion pounds (about 470 billion yen) linked to underperforming assets and factories, especially in overseas markets such as China and Europe, as well as substantial restructuring costs.
In the first half of fiscal 2024, Nissan’s consolidated sales revenue stood at 5.98 trillion yen, down 79.1 billion yen from the previous year. Operating profit dropped sharply by 303.8 billion yen to just 32.9 billion yen, leaving the company with a razor-thin operating profit margin of 0.5%. This margin reflects worsening profitability across core business segments, as well as rising material costs, foreign exchange impacts, and declining vehicle sales in several major markets.
In response to this deteriorating outlook, Nissan has initiated an aggressive corporate restructuring plan. The measures include a 20% reduction in global production capacity and the elimination of approximately 9,000 jobs, primarily at overseas plants. The company is also taking steps to consolidate production lines, shift investment away from low-margin vehicles, and withdraw from certain unprofitable markets. The suspension of its interim dividend underscores the seriousness of the financial pressure. Additionally, Nissan revised its full-year revenue forecast downward by 1.3 trillion yen, from 14 trillion yen to 12.7 trillion yen.
The challenges have triggered a leadership change at the top of the company. On April 1, 2025, Nissan appointed Ivan Espinosa as its new CEO, replacing Makoto Uchida. Espinosa, who previously served as Chief Planning Officer, has been closely involved in Nissan’s electrification and global product strategy. His appointment is seen as an attempt to inject fresh momentum into the company’s struggling performance, especially as it tries to catch up with rivals in the fast-growing EV sector.
Nissan has also reiterated its commitment to strengthening key production hubs such as its plants in Kyushu and Tochigi, calling them vital to its global supply network. These facilities are expected to remain central to future production and innovation efforts, even as the company trims operations elsewhere.
Source: FBS
