Nissan Motor Co. has released its financial results for the third quarter of fiscal year 2024. For the three-month period ending December 31, the company reported consolidated net revenue of ¥3.159 trillion, operating profit of ¥31.1 billion, and an operating profit margin of 1.0%. However, net losses widened to ¥14.1 billion, up from ¥9.3 billion in the previous quarter.
Nissan also lowered its full-year forecast for fiscal 2024, now expecting net revenue of ¥12.5 trillion and an operating profit of ¥120 billion. The company anticipates a net loss of ¥80 billion for the fiscal year.
To urgently reverse its financial decline, Nissan announced in November 2023 that it would cut global production capacity by 20% and lay off 9,000 employees worldwide. The company is implementing various cost-reduction measures, including cuts in selling, general, and administrative expenses, lower material costs, and asset optimization. CEO Makoto Uchida will voluntarily forgo 50% of his monthly salary starting in November 2024, while other executive committee members will take proportional pay cuts.
As part of its restructuring, Nissan aims to reduce total fixed and variable costs by approximately ¥400 billion by fiscal 2026. The company also plans to streamline operations, cut hiring, and accelerate voluntary retirement programs, targeting a reduction of 2,500 indirect employees worldwide.
Nissan's goal is to reduce global production capacity from the current 5 million units to 4 million units by fiscal 2026. To enhance decision-making efficiency, the company will eliminate 20% of executive positions and simplify its organizational structure.
On the same day, Honda and Nissan officially called off merger negotiations after just one and a half months, abandoning their bid to form the world's third-largest automotive group.
Honda President Toshihiro Mibe commented, "While the outcome is regrettable, we recognize that synergies can still be achieved within our existing strategic partnership." He also emphasized that Honda has no intention of pursuing a hostile takeover of Nissan.
According to Nissan's statement, the company will conduct a strategic review and actively explore new partnership opportunities. Reports from foreign media indicate that private equity firm KKR is considering investing in Nissan to improve its financial situation, with discussions currently underway.
