Nissan reported a loss of 9.3 billion yen ($60 million) for the latest fiscal quarter, a stark reversal from a profit of 190.7 billion yen in the same period last year, due to a decline in vehicle sales, rising costs, and growing inventory, AP News reports.
Nissan’s quarterly sales fell to 2.9 trillion yen ($19 billion) from 3.1 trillion yen, and the company lowered its sales forecast for the fiscal year, projecting 12.7 trillion yen ($82 billion) in revenue, down from 14 trillion yen ($91 billion). They also revised their global vehicle sales forecast to 3.4 million, lower than the previous estimate of 3.65 million. The automaker will cut 9,000 jobs (about 6% of its workforce) and reduce global production capacity by 20%.
Nissan CEO Makoto Uchida took responsibility for the poor performance, taking a 50% pay cut and promising a company turnaround. He admitted that Nissan had not responded quickly enough to market changes and rising raw material costs, especially in the US market, where the company has struggled against competitors like Ford, Toyota, and Tesla. The company has decided to forgo dividend payments and a new chief performance officer will be appointed to oversee the turnaround efforts.