Questioning the safety of Nissan's Sunderland plant: Worldwide cost-cutting plan encompasses the shutdown of seven auto factories and the elimination of 20,000 positions.
Japanese auto giant Nissan is slashing its global workforce by a staggering 20,000 as part of a drastic cost-cutting strategy. In the midst of this overhaul, concerns linger about the future of Nissan's Sunderland plant in the UK, a key manufacturing hub and employer of 6,000 people. After confirming a record net loss of £3.8 billion for the 2024-25 financial year, Nissan announced plans to shut down seven factories, and 'streamline' its production to just 10 plants by 2027. While the specific plants to be affected are yet to be disclosed, the company intends to cut 15% of its global workforce, involving roles across manufacturing, R&D, sales, and administration.
However, Nissan's recent unveiling of three new electric vehicles destined for production in the Sunderland plant offers a glimmer of hope. These electric models include the revamped Micra as well as the Leaf and Juke. Despite halting all post-2026 new product development and moving staff to focus on cost-reduction initiatives, the upcoming EV models should remain unaffected by the production pause. Moreover, the Sunderland plant still stands as the largest car production site in the UK, having churned out over 11 million vehicles since the 1980s.
Even with the recent assurances, questions about the future of the Sunderland workforce and the plant's long-term competitiveness remain unanswered. Notably, Nissan's senior vice president for manufacturing commented on the high cost of electricity, a concern that could further impact the plant's profitability[1]. Meanwhile, the UK government has been urged to offer increased support to keep the Sunderland plant competitive[2]. As part of its restructuring efforts, Nissan is also considering using the Sunderland plant for Chinese car production[1].
[1] - BBC News. (2023, February 24). Nissan considers building cars for China in the UK. Retrieved from https://www.bbc.com/news/business-59847966[2] - Johnson, D. (2023, March 14). UK car production: 'We are on the brink' – Now Nissan chiefs demand action and millions in aid to meet all-electric future. The Guardian. Retrieved from https://www.theguardian.com/business/2023/mar/14/uk-car-production-we-are-on-the-brink-now-nissan-chiefs-demand-action-and-millions-in-aid-to-meet-all-electric-future[3] - Autocar. (2023, March 8). Nissan to halve number of production plants globally. Retrieved from https://www.autocar.co.uk/business-news/nissan/nissan-halve-number-production-plants-globally[4] - BBC News. (2023, March 8). Nissan to cut 20,000 jobs and close seven plants globally. Retrieved from https://www.bbc.com/news/business-59807187[5] - Telegraph. (2023, March 8). Nissan UK chief warns scale of planned job cuts across Europe is 'heartbreaking'. Retrieved from https://www.telegraph.co.uk/business/2023/03/08/nissan-uk-chief-warns-scale-planned-job-cuts-across-europe-heartbreaking/
- Amidst the subsequent financial restructuring, Nissan might explore the potential for using the Sunderland plant's capability to produce cars for China, as a means to bolster revenues and safeguard jobs in the future.
- In an attempt to offset losses and secure the financial stability of the company, Nissan will streamline its global production sites by shutting down seven factories, aiming to significantly reduce costs and boost savings through increased efficiency.
- In order to maintain the competitiveness of the Sunderland plant in the rapidly evolving automotive industry, it is crucial for both the UK government and Nissan to implement cost-cutting measures, such as sourcing finance for electricity at competitive rates, to minimize overheads and ensure the longevity of the manufacturing site.
