TOKYO/BEIJING -- Nissan Motor Co. management has become convinced the struggling automaker needs to be much smaller and a restructuring plan due out next month would likely assume a cut of 1 million cars to its annual sales target, senior company sources said.Even before the spread of the coronavirus, Nissan's sales and profits had been slumping and it was burning through cash, forcing it to pull back on an aggressive expansion plan pursued by ousted leader Carlos Ghosn. The pandemic has only piled on urgency and pressure to renewed efforts to downsize.
No new sales target has been finalized and it remains unclear whether one will be formally disclosed.But Nissan's plans for restructuring through March 2023 should be based on the assumption that it would only be able to return to annual sales of 5 million cars by then, two people familiar with the matter said, adding this would entail a large reduction to manufacturing capacity.That compares with a goal of 6 million cars for the same period outlined in July by then-CEO Hiroto Saikawa, who had already stepped back from around 8 million targeted under Ghosn. Nissan likely sold about 5 million cars in the past financial year but this year's outlook is bleaker due to the pandemic.
"For years, Nissan was looking for annual sales volumes around 7-8 million vehicles. The company has never managed to sell much more than 5 million or so," one of the people told Reuters."The company can no longer consider this sort of wishful thinking. The resizing issue is really being taken into account, it has a lot of consequences on operations for 2020-2022."
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