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That is perhaps the scheme’s greatest weakness. Over the past five years, Nissan has on average undershot its annual sales target by more than 11%, according to Breakingviews calculations. This year, it’s even harder to have confidence in the forecast, because the current outlook doesn’t take into account the impact of tariffs.
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Ivan Espinosa is mapping a daring route. Nissan Motor’s new CEO, who replaced Makoto Uchida last month, is doubling his predecessor’s planned job cuts and plant closures. Hitting his sales target will be tough in the face of tariffs, but controlling costs gives the $8 billion carmaker more of a buffer.
Espinosa’s task is urgent. On Tuesday, Nissan reported, a net loss of $4.5 billion for the year ending in March 2025. Failed deal talks with Honda wasted precious time.
So as well as shrinking headcount by around 20,000, and reducing the number of plants to 10 from 17, Espinosa wants to cut the proportion of its production capacity sitting idle from the current 30% to close to zero. He will reassign 3,000 employees to find new ways to cut costs and quicken development cycles too.
Altogether, he estimates the group can reduce operating costs by 500 billion yen versus the year just past. Previously, Uchida has planned to bring down costs by 400 billion yen, versus forecast expenses for 2026: Espinosa’s new scheme would in theory save 550 billion yen compared with that same benchmark, some 37.5% more than the previous plan.
On the top line, a revised sales forecast of 3.25 million cars for the year ending in March 2026 is less than the 3.3 million deliveries Nissan clocked in its last financial year. But it is also ambitious: to hit the numbers, Nissan will have to maintain or grow sales everywhere but China, where it has resigned itself to sales falling 18%.
In Nissan’s largest market, the US, it is dependent on imports – it sold some 900,000 cars there last year, but made only about 500,000 vehicles in the country. President Donald Trump’s 25% duties will mean Nissan needs to swallow the costs or pass them on to customers, hurting their competitiveness. It could also bash consumer confidence.
At least Espinosa’s harsher cuts give Nissan extra wiggle room; the company reckons they will let the company break even selling 2.5 million cars, more than a fifth below his target. Nissan is now at least prepared for more bumps in the road.