Nissan scrambles to cut $2.59b, seeking new partners after this

Layouts – including in the U.S. factory – a lineup of productivity and simplified models that reduce breakeven at $2.59 billion

What’s next for Nissan? The Japanese automaker was forced to make a turnaround plan B after the collapse of its merger with Honda, with a new strategy involving cutting billions of dollars in costs from a failed business and urgently finding new partners.

Nissan aims to provide savings of ¥400 billion (USD 259 million) in fiscal 2026, which will be achieved through reduced and productivity measures. Drive today became even more urgent after Nissan cut its expected operating profit in 2024 from 202.4 billion yen ($970 m) to 12 billion yen ($780 m) due to slow sales.

Related: Honda – Nissan $60B merger officially on control issues, Mitsubishi

Three-quarters of the savings of ¥40 billion ($194 million) will come from fixed costs. There will be about 2500 indirect jobs (but 1,000 will be created in shared service centers and consolidate Smyrna and Canton production lines in the United States, Thailand will reduce staff numbers by 6,500 in two years.

Other savings come from shortening development time for new vehicles while simplifying the product lineup, making parts less complex and cutting inefficient parts for supply chains should contribute 10 billion yen ($650 million). However, Nissan knows that when China’s auto industry is getting stronger, it’s not just taking money from its business to ensure its long-term survival.

“It’s still difficult to survive without relying on future partnerships,” Ceo Makoto Uchida told Bloomberg.

Nissan needs another collaboration alongside Honda’s troubled New Yorkers and claims it will “conduct a strategic review to actively explore new partnerships.”

One company that expressed interest in working with Nissan is tech giant Foxconn. Taiwan-based Foxconn chairman Young Liu said this week it is willing to invest in automakers, but that is not its first choice.

“If the cooperation requires it, we will consider (buying Nissan shares),” Liu told Reuters. “Buying stocks is not our goal; our goal is to cooperate,” he continued, adding that Foxconn is working with Renault, Nissan’s largest shareholder.