Is Nissan’s Sunderland factory safe? Huge cost saving plan includes  closures and 20,000 job cuts

Nissan will cut almost 20,000 jobs and shutter seven factories as part of a monumental cost-saving exercise, after confirming huge losses in its full-year fiscal results.

The Japanese manufacturer announced a record net loss of 750 billion yen – around £3.8billion – for the 2024-25 financial year on Tuesday, as it detailed a raft of measures to stave off its financial woes.

But the key question for many in Britain – particularly those employed by the firm or in jobs related to it – is what does it mean for the future of Nissan’s Sunderland plant and its 6,000-strong workforce in the North East? 

The Yokohama-based company has endured a tough period – the group last year described itself as being ‘on the brink of collapse’ with just ‘12 months to survive’.

It now plans to lay off 15 per cent of its workforce as part of a major restructuring drive. This will see an additional 11,000 job losses on top of those announced in November after raising the alarm following a crash in sales in its two biggest markets, America and China.

Projecting a tough 2025, with the challenge of ‘intense competition, forex and inflationary pressures’, Nissan today unveiled collective measures estimated to save the business 500 billion yen (£2.6billion). 

Nissan’s cost savings measures

The ‘Re:Nissan Plan’ announced Tuesday sets a number of stringent cost-saving measures to pull the car maker out of the red.

It ‘aims for positive operating profitability and free cash flow in the automotive business by FY 2026’ and focuses on job cuts, plant closures and production restructuring.

The headline announcement is that it will reduce its workforce by 20,000 employees between 2024 and 2027. This is inclusive of the previously announced 9,000 job losses. 

Cuts will cover roles across manufacturing, R&D, sales and administration.

Nissan currently employs 133,580 people globally, around 6,000 of them at its Sunderland plant, where it builds the Qashqai and Juke. 

The company says it will reduce the number of vehicle production plants it has globally by seven, slashing its manufacturing footprint from 17 plants to just 10 by 2027. 

Currently, it is not yet clear which plants will be affected.

It will also ‘streamline’ its powertrain plants – this includes axing its proposed battery gigafactory in Kyushu, Japan’s most southwestern island.

In fact, all post-2026 new product development has been paused indefinitely, with 3,000 staff overseeing these projects moved to focus on unspecified ‘cost reduction initiatives’, thought to involve revamping Nissan’s supply chain.

This is not inclusive of the three recently-unveiled EVs due to be produced in Sunderland – all of which are due to arrive before the end of next year.

Additionally, it has put in a long-term schedule to simplify its range, reducing the number of different vehicle ‘platforms’ (the architecture on which different models are based) from 13 to just seven by 2035. 

As well as ‘more market-focused and brand-oriented’ product strategy, Nissan will centre its new lineup ‘around signature Nissan models that deliver strong nameplates’. 

Nissan’s recent unveil of three new EVs confirms this approach – similar to Renault, Ford and Fiat who’ve both brought out new models inspired by old nameplates as part of their EV-only strategies.

The company’s new chief executive, Ivan Espinosa, who took over the helm only last month, said in an official statement: ‘In the face of challenging full-year 2024 performance and rising variable costs compounded by an uncertain environment, we must prioritise self-improvement with greater urgency and speed, aiming for profitability that relies less on volume.

‘As new management, we are taking a prudent approach to reassess our targets and actively seek every possible opportunity to implement and ensure a robust recovery.’

What’s the future for Nissan production in UK? Will Sunderland be saved?

There is still no word as to whether Sunderland, the heart of Nissan manufacturing in Britain, will be closed and see job losses or not.

This is Money has reached out to Nissan UK for confirmation as to whether the 800-acre site which employs around 6,000 people and has produced over 11 million cars will be impacted, but spokespeople for the brand declined to comment.

Sunderland employees have assembled models such as the Bluebird, Primera, Micra and Almera, and now produce the Qashqai and Juke models.

Last year, 282,124 vehicles – including Jukes, Leaf EVs and Qashqais – were built there. This output represented more than one in three (36.2 per cent) passenger cars made in UK factories in 2024.

However, production was down some 13.2 per cent on the year previous.

It was confirmed in February that a late shift on one of the factory’s assembly lines would be closed, but no jobs were lost after some 400 affected workers were moved other production lines to ‘maximise efficiency’.

Alan Johnson, senior vice president for manufacturing for Nissan’s Africa, Middle East, India, Europe and Oceania operation, last month raised doubts about Sunderland’s future, stating that the UK was ‘not a competitive place’ to build cars as he called for increased Government support.

He told MPs that Sunderland ‘pays more for its electricity than any other Nissan plant in the world’ – after disclosing that it was cutting back evening shifts in order to save money.

However, earlier this week, Nissan’s battery partner – Envision AESC – received a £1billion of investment into its new gigafactory in the North East city. This second battery factory in the region is aimed at supplying cells for the next-generation Nissan Leaf.

The deal comprises £680million of funding from a group of banks (including BBVA, HSBC, the SMBC Group, Société Générale and Standard Chartered), guaranteed by two UK government bodies, the National Wealth Fund and UK Export Finance. 

The remaining £320million comes from private financiers and Envision itself.

This battery manufacturing site close to the car plant will supply the most expensive parts powering the three next-generation EV models produced in Sunderland.

In March, Nissan revealed an all-new Leaf EV, confirmed it will revive the iconic Micra name with a battery power supermini later this year, and an all-electric Juke.

The Qashqai – one of Britain’s best-selling cars and a model largely credited with pioneering the SUV trend – will also be upgraded at the Sunderland plant Nissan said.