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Struggling Nissan reports heavy losses, cuts production
[TOKYO] Crisis-hit Japanese automaker Nissan on Thursday reported a staggering 671.20 billion yen (S$8.84 billion) annual net loss, its first in over a decade, as it battles weak demand and the impact of the coronavirus pandemic.
The results are the latest blow for a firm which has also struggled to deal with the fallout from the arrest of former boss Carlos Ghosn, currently an international fugitive after jumping bail and fleeing Japan.
The automaker said it was slashing global production by 20 per cent and confirmed it would close a plant in Barcelona that employs 3,000 people as it tries to return to profitability.
The firm said it logged a net loss of 671.20 billion yen for the year to March, compared with the net profit of 319.10 billion yen a year earlier.
It said the global pandemic had "substantially impacted" its production, sales and other business activities in all regions.
It declined to issue a forecast for the current fiscal year because of ongoing uncertainty.
The results were even worse than had been projected, and come with the auto sector as a whole facing an existential crisis as the global pandemic forces people to stay indoors.
The situation is compounded for Nissan by a series of existing problems, including weak demand, the Ghosn arrest scandal and tensions in its alliance with Renault and Mitsubishi Motors.
"Nissan is facing an extremely tough business environment," said Satoru Takada, auto analyst at TIW, a Tokyo-based research and consulting firm.
"The coronavirus shock hit Nissan when it was already struggling to recover," Mr Takada told AFP before the announcement.
"Nissan has already cut jobs but extra restructuring may be needed," he said.
"Nissan cannot expect a V-shaped recovery. It is at a crucial stage," he added.